Wall Street indexes fall with inflation data and rates in focus
Wall Street's main indexes closed lower on Tuesday as technology sector losses offset gains in communications services while investors waited for key inflation reports that may influence the Federal Reserve's next interest rate decisions.
Among the S&P 500's 11 major industry sectors, only three ended with gains a day ahead of the November reading of the Consumer Price Index, one of the last major reports ahead of the Fed's Dec. 17-18 meeting. Headline inflation is expected to have risen slightly in November to 2.7% from 2.6% in October. The Producer Price Index report will follow on Thursday.
«There's a little bit of wait-and-see in the market ahead of the CPI and PPI data this week,» said Mona Mahajan, head of investment strategy at Edward Jones. «Markets want to see a number that won't be too disruptive to the Fed next week.»
If the CPI comes in line with estimates, investors will expect an «all clear» for the Fed to lower rates by 25 basis points next week, she added.
Traders see an 86% chance for a cut next week, CME's FedWatch Tool showed. Bets had jumped after Friday's news of an uptick in unemployment along with a rebound in job growth, which had slowed in October.
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