Nike, Fed's main inflation gauge, UK recession - what's moving markets

investing.com:

Investing.com — The main indices point toward a weaker open on Wall Street, amid a degree of caution ahead of the release of key U.S. inflation numbers. A weak outlook from sporting retail giant Nike also weighed, although a continuation of the year-end rally with weekly gains still looked likely. The news in the U.K. was less impressive, as its economy retreated in the third quarter, opening up the possibility of a recession to end the year.

Investors will get one more look at the inflation picture in the U.S. before they head off for their Christmas holidays with the release of the personal consumption expenditures report, the Fed’s primary inflation gauge, for November.

Economists are expecting the PCE price index to remain flat for a second month in November, while the core measure that strips out volatile food and energy costs is seen rising 0.2%.

A more dovish tone from the Federal Reserve at its last meeting has resulted in investors pricing in around 150 basis points of interest rate cuts next year, particularly as evidence mounted that price pressures are easing and the labor market is cooling in the face of the aggressive rate hikes from March 2022 to July 2023.

Any signs of sticky inflation are likely to dent these rate cut expectations, but Thursday's downward revision to the PCE in third-quarter growth data bodes well for a downside surprise.

U.S. stock futures fell on Friday amid caution ahead of key inflation data, although the year-end rally looks set to continue with more weekly gains.

By 04:55 ET (09:55 GMT), the Dow futures contract was down 100 points, or 0.3%,, S&P 500 futures had dipped by 4 points or 0.1%, and Nasdaq 100 futures had fallen by 40 points or 0.2%.

The three main indices closed