Tuesday’s Mid-Day Movers: 3 Stories Driving Markets

U.S. stocks advanced on Tuesday afternoon, curbing some of Monday’s losses. Investors kept one eye on economic indicators and another on corporate earnings, which were largely positive. At 12:45 p.m.:

DJIA: +0.88% to 14,727.80 S&P 500: +1.04% to 1,568.58 NASDAQ: +1.22% to 3,255.66
Gold: +1.23% to $1,377.90 per ounce Oil: -0.48% to $88.28 per barrel U.S. 10-Year: +0.039 points to 1.720%

Here are three stories helping shape the markets on Tuesday afternoon:

1) Will Deflation Keep the Fed Printing? The Consumer Price Index for All Urban Consumers (CPI-U) decreased 0.2 percent month over month in March, according to data released by the Bureau of Labor Statistics on Tuesday. This compares against a 0.7 percent increase in February. Analysts were expecting no movement in the index for March. Over the past 12 months, the all-items index is up 1.5 percent.

At a glance, today’s report suggests that inflation remains comfortably below the Federal Reserve’s 2.0-2.5 percent speed limit. The core year-on-year growth trend (which excludes food and energy) in the price of the consumer goods edged consistently lower in 2012, and has remained at 2.0 percent or below since August… (Read more.)

2) Will U.S. Industrial Production Lead Economic Growth? Industrial production rose 0.4 percent month over month in March, according to data released by the Federal Reserve on Tuesday. This figure compares against the 1.1 percent increase reported in February, and it was slightly above consensus estimates for a 0.2 percent increase.

The Federal Reserve’s industrial production index is broken down into three major industry groups. The index and all of its components are pegged to a 2007 level of 100. The most-watched segment is manufacturing, which declined 0.1 percent last month to a level of 95.7. Significantly, the output of motor vehicle parts increased. Total vehicle assemblies rose 3.4 percent to an annualized rate of 11.05 million… (Read more.)

3) Can April Retail Sales Live Up To This Forecast? March served up very disappointing news for both the labor market and consumer spending; the Employment Situation compiled by the Bureau of Labor Statistics showed that the U.S. economy created a disappointing number of jobs last month — hitting a low for the recovery — while retail sales declined 0.4 percent in March, according the Commerce Department. Adding to that weighty economic load, the University of Michigan-Thomson Reuters consumer-sentiment gauge dropped to a preliminary April reading of 72.3 — the lowest result since July.

While ICSC has forecast that April sales will increase by 2 percent to three percent, from this week’s look at the data, it seems that economic conditions could not change the current downward trend in retail sales as of yet, posing a concern for United States gross domestic product growth… (Read more.)