Stock futures negative after manufacturing, CPI data

By Andrea Tse

U.S. stock futures fell further Wednesday after lower-than-expected manufacturing sector and inflation figures.

Futures for the Dow Jones Industrial Average ($INDU) were down by 20 points at 13,113. S&P 500 ($INX) futures were down by 1.79 points at 1,399. Futures for the Nasdaq ($COMPX) 100 were falling by 1.75 points to 2,725.

The major U.S. equity averages finished mixed Tuesday as a stronger-than-expect​ed rebound in retail sales in July failed to fuel substantial buying.

The Labor Department reported before the markets open that the consumer price index was unchanged in July versus being unchanged in June. The core number, excluding the food and energy items, rose 0.1% after being up 0.2% in June.  Economists surveyed by Reuters expected the headline CPI to rise 0.2% in July and the core number to stay at 0.2%.

At the same time, the New York Fed’s Empire state survey showed that the general business conditions index weakened to negative 5.85 in August from 7.39 July.

“From a market standpoint, today’s data works in favor of those believing the Fed is more likely to ease policy in coming months,” said Dan Greenhaus, chief global strategist at BTIG.  “Core prices appear to have topped out for now while headline prices have been pushing lower since the middle of 2011.  The FOMC will not like that very much.”

“The Empire Manufacturing survey is our first look at the manufacturing sector each month and in August, our first look was not good,” he added.  “The report isn’t entirely negative per se but it’s certainly broadly negative.” 

The Federal Reserve is predicted to say at 9:15 a.m. that industrial production rose 0.5% in July after gaining 0.4% in June. Capacity utilization is expected to have risen to 79.2% after increasing to 78.9% the month before.

At 10 a.m., the National Association of Home Builders is forecast to say that the housing market index stayed at 35 in August.

September crude oil futures were off 28 cents at $93.15 a barrel and December gold futures were down $5.90 at $1,596.50 an ounce.

The benchmark 10-year Treasury was slipping 6/32, raising the yield to 1.761%. The greenback was up 0.23%, according to the dollar index.

The FTSE in London was off 0.41% and the DAX in Germany was shedding 0.48%.

The Hong Kong Hang Seng index closed lower by 1.18% and the Nikkei in Japan finished down 0.05%.

In corporate news,  Cisco (CSCO) is expected to report fiscal fourth-quarter results after Wednesday's closing bell and analysts are calling for the networking equipment giant and Dow component to post earnings of 45 cents a share on revenue of $11.6 billion.

TheStreet will be live-blogging Cisco's results Wednesday at 3:45 p.m. EDT.

Warren Buffett's Berkshire Hathaway (BRK.A) revealed in a 13-F filing it sold a stake in Intel (INTC), added to positions Wells Fargo (WFC) and  Bank of New York Mellon (BNY) and sold off significant portions of positions in United Parcel Service (UPS) and Visa (V).

Berkshire Hathaway also bought shares of Phillips 66 (PSX) and National Oilwell Varco (NOV) in the second quarter.

Standard Chartered shares were rising in London after it agreed Tuesday to pay $340 million to New York's Department of Financial Services to settle accusations the U.K. bank hid illegal transactions with Iran and violated U.S. sanctions law.

New York Times (NYT) named Mark Thompson as its next president and CEO. Thompson most recently served as director general of the British Broadcasting Corp.