Dados para hoje nos states: Taking the economy's temperature

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Taking the economy's temperature

Readings on December wholesale prices, retail sales could set course for markets in Friday trading.

January 13, 2006: 7:55 AM EST


NEW YORK (CNNMoney.com) - Investors will be looking to the latest economic readings for direction in Friday trading.

U.S. stock futures were slightly lower, although comparisons to fair value indicated a mixed or flat opening for stocks ahead of some closely watched economic reports.

At 8:30 a.m. ET the government will report on wholesale prices and retail sales.

The Producer Price Index, the key measure of prices paid by businesses, is forecast to be up 0.4 percent for December, according to economists surveyed by Briefing.com, compared with a 0.7 percent decline in November. The so-called "core PPI," which excludes often-volatile food and energy prices, is expected to be up 0.2 percent, following a 0.1 percent increase in November.

Inflation readings have been getting particular attention in recent months as the Federal Reserve has indicated it will be watching data to determine how much it needs to continue raising interest rates to maintain price stability.

"It's important for the market that we don't get an upside surprise on the core," said David Kelly, economic advisor for Putnam Investments. "The really crucial issue for the Fed's statement later this month is whether higher energy prices are starting to feed through to inflation."

Retail sales for the key December period are forecast to have grown 1 percent, compared with a 0.3 percent gain in November. Excluding auto purchases, retail sales are seen up 0.4 percent, following a 0.3 percent decline in November.

Oil prices were lower following the sharp rise earlier in the week on concerns about Iran's nuclear program.

The February light crude futures contract for NYMEX lost 31 cents to $63.63 a barrel in electronic trading, while the February contract for Brent crude was down 27 cents to $62.35.

Major markets in Asia closed mostly up Friday, as Japan's Nikkei hit yet another five-year closing high and South Korea's Kospi hit a record. Major European markets were lower in early trading.

Treasury prices were slightly lower in early trading, lifting the yield on the 10-year note to 4.42 percent from 4.40 late Thursday. The dollar was weaker against the euro but stronger against the yen.

In corporate news, Boston Scientific (Research) raised its takeover bid late Thursday for Guidant (Research) to almost $25 billion, or $1 a share to $73, in an attempt to win the bidding war with Johnson & Johnson (Research).

IBM (Research) announced late Thursday that the SEC is launching a formal investigation into the way IBM reported first-quarter 2005 earnings and the way it plans to expense for stock options.

Executives at embattled auto manufacturer General Motors (Research) will meet with analysts at 8 a.m. ET Friday. Kirk Kerkorian, GM's largest shareholder, has called for the company to cut its dividend as well as executive pay in a bid to win concessions from the union and stem its ongoing losses.

Another Dow component under scrutiny Friday will be insurer American International Group (Research), as The Wall Street Journal reported it is close to a $1 billion settlement of the civil investigations by state and federal authorities into an accounting scandal there.

The Maryland legislature overrode Gov. Robert Ehrlich's veto late Thursday, enacting legislation that would force Wal-Mart Stores (Research) to spend more on employee health care in the state.

Conglomerate Tyco (Research) made the anticipated announcement that it is splitting into three separate companies, as it also warned its first-quarter earnings would fall short of forecasts. Shares of Tyco were 4 percent lower in pre-market trading on Inet on the warning.