Markets brace for econorama
Stocks set for lower open as investors await barrage of economic data; key inflation reading rises as expected.
NEW YORK (CNNMoney.com) -- U.S. stock looked set for a lower open Tuesday after a report showed a steady rise in consumer prices.
At 9:10 a.m. ET, Nasdaq and S&P futures were down, indicating a lower start for the major indexes.
An inflation reading in the government's report on personal income and spending released before the market showed that core inflation rose 0.2 percent in June, in line with expectations.
Many experts say the report's so-called core PCE price reading is closely watched by the Federal Reserve.
Futures bounced off their lows immediately after the report before reversing course and heading sharply lower as traders expressed concern over the inflation outlook.
"Economic data is going to be the main driving force. The key to economic reports always is the inflationary related aspects of them," Peter Cardillo, chief market strategist for SW Bach, said.
The report also showed that personal income rose 0.6 percent while spending increased 0.4 percent in June. Those figures matched Wall Street's estimates.
Investors are bracing for a wave of economic reports that could address the interest rate concerns that have plagued the markets in recent weeks.
The Institute of Supply Management's index on the manufacturing sector in July as well as June construction spending figures are due after the market open.
With the next Fed meeting just a week away, investors will be monitoring each data release for clues about what central bank policymakers will do when they meet Aug. 8.
Market watchers are uncertain whether the Fed will raise rates for the 18th straight time next week or put the brakes on its interest rate-raising campaign. The Fed has hiked the fed funds rate, a short-term overnight bank lending rate target, to 5.25 percent from 1 percent.
Also on tap Tuesday: The Big Three U.S. automakers will release their sales results for July.
The corporate earnings season is starting to wind down, and results for the most part have been strong, with many large companies giving positive guidance, Cardillo said.
Oil prices rose, with U.S. light crude up 34 cents in electronic trading to $74.74 a barrel, while Brent crude traded in London was 29 cents higher at $75.44.
Treasury prices eased, with the yield on the 10-year note at 5.01 percent, up from 4.98 percent late Monday. Bond prices and yields move in opposite directions.
The dollar edged slightly higher against the yen and euro.