Wall Street gains, dollar eases ahead of CPI report
By Stephen Culp
NEW YORK (Reuters) — Wall Street advanced and the dollar retreated on Monday, as investors looked ahead to Wednesday's inflation data, while the Bank of Japan suggested it could be moving toward closing the door on an era of negative interest rates.
The tech-laden Nasdaq led all three major U.S. stock indexes higher in the wake of last week's net losses, with electric automaker Tesla (NASDAQ:TSLA) Inc providing the biggest boost to the upside. The relatively languid session appeared to be the calm before a storm of U.S. economic data this week, with Wednesday's crucial consumer prices report (CPI) paramount.
«We're in the horse latitudes, with lack of directional breezes prior to the Fed meeting,» said Sam Stovall, chief investment strategist of CFRA Research in New York. «What's driving the markets today is the anticipation of what may come later this week.»
«Investors are focusing on how they will respond to Wednesday's CPI report,» Stovall added.
Analysts expect inflation to have heated up last month, driven by rising oil costs. The core measure, which strips away volatile food and energy prices, is seen cooling on an annual basis.
The hotly anticipated CPI data will give market participants a snapshot of August inflation, and could provide some illumination regarding the duration of the U.S. Federal Reserve's restrictive policy cycle.
The Fed, which has left the door open to further interest rate hikes, has pledged to remain agile in its response to economic data.
Financial markets have essentially baked in a rate pause at the conclusion of its September 19-20 monetary policy meeting, beyond which the path forward grows less certain, according to CME's FedWatch tool.
Elsewhere, comments from Bank of
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