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Day Ahead: Top 3 Things to Watch for May 12

Published 11/05/2020, 21:28
Updated 11/05/2020, 21:37
© Reuters.

By Kim Khan 

Investing.com - The broader stock market finished flat today as worries about more virus infections after lockdown measures are eased dented sentiment.

Tomorrow investors will get more numbers on the inflation picture and there will be a host of Federal Reserve member comments to parse.

In commodities, the oil market will get a measure of U.S. stockpiles.

Here are three things that could move the markets tomorrow.

1. CPI Expected to Fall

The market will get the latest numbers on retail inflation tomorrow.

The Labor Department will release the April consumer price index (CPI) at 8:30 AM ET (12:30 GMT).

Economists expect that the CPI fell 0.8% in April to an annual rate of 0.4%, according to forecasts compiled by Investing.com.

The core CPI, which excludes volatile food and energy prices, is expected to have fallen 0.2% last month to an annual rate of 1.7%.

J.P. Morgan said today that investors should set aside worries about a surge in inflation sparked by stimulus from the Federal Reserve for the time being. Economies will go through a deflationary period before reflation, which won’t begin until the fourth quarter at the earliest, it said.

2. Lots of Fed Speak Scheduled

There are a host of Federal Reserve board members speaking tomorrow.

At 9:00 AM ET, Minneapolis Fed President Neel Kashkari and St. Louis Fed President James Bullard will both be giving speeches.

Kashkari has been less bullish on the economic recovery than those in the White House. Last week he said that the jobless rate will likely continue to climb and could get as high as 24%.

Over the weekend, Kashkari stressed that the recovery would be “slow and gradual” and that a robust recovery would require the development of a vaccine.

At 10:00 AM ET, Philly Fed President Patrick Harker and Fed Governor Randal Quarles will be speaking.

3. API Inventories on Tap

Oil prices settled lower today as concerns about new cases of Covid-19 globally canceled out the bullishness of Saudi Arabia cutting its output by an extra 1 million barrels per day.

Tomorrow the American Petroleum Institute will release its measure of U.S. oil inventories after the bell.

The API snapshot showed a rise of 8.4 million barrels last week.

A report from private consultancy Seevol on Monday suggested that stocks at the U.S. national hub of Cushing, Okla. had fallen by 2.17 million barrels last week.

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