Stocks Await Consumer Prices

Futures edge lower ahead of a big report on inflation.
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Stocks drifted slightly lower early Wednesday as buyers were tentative ahead of another key reading on inflation.

Index futures recently showed the

S&P 500

trading about a point below fair value and the Nasdaq 100 set for a 2-point decline. The 10-year Treasury was up 2/32 in price to yield 4.92%, and the dollar was little changed against the yen and euro.

At 8:30 a.m. EDT, the Labor Department is expected to say the consumer price index rose 0.4% on the headline and 0.2% on a core basis in July. The report comes a day after a much lower-than-expected reading on the core producer price index.

The soft PPI powered stocks Tuesday. The

Dow Jones Industrial Average

rose 132 points to 11,230, the S&P 500 gained 17 points to 1285, and the

Nasdaq Composite

jumped 46 points to 2115.

Also on the economic docket, the Commerce Department will post data on housing starts for July, and the

Federal Reserve

will report on last month's industrial production and capacity utilization.

Oil extended its decline into a third day, recently losing another 20 cents to $72.85 a barrel in Nymex electronic trading. Since Friday's close, crude prices have fallen 2% as the cease-fire between Israeli forces and Hezbollah has held up.

Late Tuesday,

Applied Materials

(AMAT) - Get Report

posted a fiscal third-quarter profit of $512 million, or 33 cents a share, up 39% from last year. Sales surged 56% to $2.54 billion. Results beat the Thomson First Call average estimate for earnings of 30 cents a share on revenue of $2.4 billion.

After the market closes, third-quarter earnings are expected from Dow component


(HPQ) - Get Report

. Analysts expect the company to earn 47 cents a share.

Overseas markets were mixed, with London's FTSE 100 recently losing 0.7% to 5859 and Germany's Xetra DAX flat at 5777. In Asia, Japan's Nikkei rose 1.6% overnight to 16,071, and Hong Kong's Hang Seng gained 1% to 17,451.

To view Farnoosh Torabi's video take on today's market, click here