After moving sharply higher over the two previous sessions, stocks may give back some ground in early trading on Thursday. The major index futures are currently pointing to a lower open for the markets, with the Dow futures down by 117 points.
Renewed inflation concerns may lead to a pullback on Wall Street after a highly anticipated Labor Department report showed the annual rate of growth in consumer prices accelerated more than expected in the month of January.
The report showed consumer prices in January were up by 7.5 percent compared to the same month a year ago, reflecting the fastest annual growth since February of 1982. Economists had expected the annual rate of growth to reach 7.3 percent.
The faster year-over-year growth came as the Labor Department said its consumer price index climbed by 0.6 percent in January, matching the upwardly revised advance seen in December.
Economists had expected consumer prices to rise by 0.5 percent, matching the increase originally reported for the previous month.
The report showed core consumer prices, which exclude food and energy prices, also advanced by 0.6 percent in January, matching the increase seen in December. Economists had also expected core prices to rise by 0.5 percent.
The annual rate of growth in core prices accelerated to 6.0 percent in January from 5.5 percent in December, showing the biggest jump since August of 1982.
The data may raise concerns that the Federal Reserve will increase interest rates more aggressively in its effort to fight elevated inflation.
Meanwhile, a separate report from the Labor Department showed another modest decrease in initial jobless claims in the week ended February 5th.
The report said initial jobless claims fell to 223,000, a decrease of 16,000 from the previous week's revised level of 239,000.
Economists had expected jobless claims to dip to 230,000 from the 238,000 originally reported for the previous month.
While the inflation data may weigh on the broader markets, some individual stocks are likely to see initial strength on upbeat earnings news.
Shares of Disney (DIS) are moving sharply higher in pre-market trading after the entertainment giant reported fiscal first quarter earnings that exceeded analyst estimates on both the top and bottom lines.
Stocks showed a strong move to the upside during trading on Wednesday, extending the rally seen on Tuesday. The major averages all moved notably higher, with the tech-heavy Nasdaq helping to lead the advance.
The Nasdaq reached a new high for the session going into the close, spiking 295.92 points or 2.1 percent to 14,490.37. The S&P 500 also surged up 65.64 points or 1.5 percent to 4,587.18, while the Dow jumped 305.28 points or 0.9 percent to 35,768.06.
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Thursday. Japan's Nikkei 225 Index rose by 0.4 percent, while China's Shanghai Composite Index edged up by 0.2 percent.
Meanwhile, the major European markets have moved to the downside on the day. While the French CAC 40 Index has slid by 0.6 percent, the U.K.'s FTSE 100 Index and the German DAX Index are down by 0.2 percent and 0.1 percent, respectively.
In commodities trading, crude oil futures are jumping $1.02 to $90.68 a barrel after rising $0.30 to $89.66 a barrel on Wednesday. Meanwhile, after climbing $8.70 to $1,836.60 an ounce in the previous session, gold futures are slipping $2.70 to $1,833.90 an ounce.
On the currency front, the U.S. dollar is trading at 116.13 yen versus the 115.52 yen it fetched at the close of New York trading on Wednesday. Against the euro, the dollar is valued at $1.1386 compared to yesterday's $1.1425.
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