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James Hyerczyk
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US Stock Market

The major U.S. stock indexes are trading lower shortly before the cash market open on reports that U.S. regulators are calling for a pause in the use of the Johnson and Johnson vaccine due to clotting issues. This is breaking news so watch for updates as the market approaches its opening at 12:30 GMT.

At 11:09 GMT, June E-mini S&P 500 Index futures are trading 4106.00, down 14.25 or -0.35%. The June E-mini Dow Jones Industrial Average futures contract is at 33505, down 126 or -0.37% and the June E-mini NASDAQ Composite is at 13789.00, down 19.75 or -0.14%.

Investors Bracing for US Consumer Inflation Data

Ahead of the breaking news, U.S. stock futures were mostly flat ahead of a highly anticipated inflation report set for release before Tuesday’s opening bell on Wall Street.

The pace of consumer inflation is likely to have returned to pre-pandemic levels in March, and it is expected to heat up even more in the next couple of months.

Rising inflation is one of the biggest fears in the market, and if it gets too hot, it could corrode asset values, limit buying power and eat away at corporate margins.

It is inevitable the reopening economy will generate some pick-up in inflation, with demand up sharply and supply chain issues resulting in shortages. Newly vaccinated consumers are also expected to resume traveling and other activities outside the home, which could create a temporary surge in services inflation.

But the Fed and some economists argue this inflationary pick up will be temporary, meaning it should not derail the recovery or result in Fed rate hikes. That makes every new inflation report very important to markets, and that is the case with Tuesday’s 12:30 GMT release of March CPI.

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CPI Report Expectations

The March consumer price index is expected to show a moderate 0.2% increase in core inflation, excluding food and energy prices, according to economists polled by Dow Jones. On a year-over-year basis, that is a 1.5% pace, compared to 1.3% in February.

March headline inflation is expected to increase by 0.5% or 2.5% year-over-year, up from 1.7% in February. By May, some economists expect headline inflation could be running at a year-over-year rate of 3.5% or more. The headline rate was last at 2.5% in January, 2020.

For a look at all of today’s economic events, check out our economic calendar.
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