Futures Off Slightly as Eyes Turn to the Cliff

Morning Outlook

The S&P will look to extend its five session winning streak on Thursday and will need a ref to green move to do so as futures are slightly lower.  It is a data heavy day following the fallout of the December FOMC meeting, with weekly jobless claims highlighting the day’s reports. We are not seeing any Fed bounce despite their additional measures, as the fiscal cliff is the prime market focus. S&P 500 Index futures fell 2.5 points, or 0.2%, to 1,424.80, while futures on the Dow Jones Industrial Average lost 8 points, or 0.1%, to 13,222. Nasdaq 100 futures slipped 0.25 point, or less than 0.1%, to 2,670.

Wall Street retreated following the afternoon press conference from Fed Chairman Ben Bernanke, giving up mid-day gains to close mixed. Halting a five-session winning run, its longest since March, the Dow Jones Industrial Average declined 2.99 points, or -0.02% to 13,245.45. The S&P 500 Index advanced its winning streak after posting a 0.64-point gain, or 0.04% to end at 1,428.48, while the Nasdaq Composite Index fell 8.49 points, or 0.28%, to 3,013.81.

Currencies and Commodities

The dollar rose 0.18% at 83.4100 yen in the currency market. The euro is losing 0.11% at $1.3059 while the pound is depreciating 0.16% to $1.6123. Gold is down $21.30 to $1,696.60, while silver is off 2.80% at $32.84. Light, sweet crude for January is falling 36 cents to $86.41 per barrel on the NYMEX; a 0.41% decline.

Economic Calendar

8:30 AM
Jobless Claims: New unemployment claims for the week of December 8th, to show the number of individuals who filed for unemployment insurance for the first time. The fewer people filing for unemployment benefits, the more have jobs, the more income in the consumer’s pocket, as well as a forecast on the strength of the economy. The consensus is for 370,000 for first time jobless claims, even with last week which saw a 25K decline. This is the first look at December payroll following the better than expected November Employment Situation . The consensus range goes from 360K to 375K.

8:30 AM
Producer Price Index: The PPI is a measure of the average price level for a fixed basket of capital and consumer goods received by producers. This is a great indicator of the future CPI as producers will eventually pass the costs onto the consumer. The consensus is for a 0.5% decline in the month of November. The range goes as low as -0.9% up to 0.2%. That figure is below the 0.2% decline in October. At the core level, the October PPI fell 0.2 percent, while the core consensus is a 0.2 percent gain.

8:30 AM
Retail Sales: measure the total receipts at stores that sell durable and nondurable goods. Consumer spending accounts for two-thirds of GDP and is therefore a key element in economic growth.  The consensus is for a 0.6% gain in the month of November, as retail sales in October posted a weak 0.3% decline, most likely affected by Hurricane Sandy. This is a key figure as it includes the start of the holiday shopping season. The consensus range falls as low as 0.2% and upwards of 2.0%.

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