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Stocks head to lower open ahead of inflation data

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[May 15, 2009]  NEW YORK (AP) -- The stock market headed toward a lower open Friday as investors await reports that are expected to show that the economy's slide continues to slow.

The government will be releasing April consumer price and industrial production data before the trading day begins.

The Labor Department's consumer price index is expected to show no change as energy price dips offset gains in the cost of other goods and services, according to economists surveyed by Thomson Financial. The CPI is due out at 8:30 a.m. Eastern time.


The Federal Reserve, meanwhile, is expected to report at 9:15 a.m. that industrial production fell in April but at the slowest pace in six months. That would fit in with the trend in other economic data since early March that have shown an economy that's still contracting, but at a slower rate.

Economists forecast a 0.6 percent drop in industrial production.

Investors are in a bit of a lull now. The government's stress tests of banks are done, earnings reports are winding down and the first wave of April economic data has been released. Wall Street's huge spring rally has stalled amid concerns that investors got a little too optimistic when they saw signs of the economy bottoming. Some believed a recovery might come sooner than expected.

Although the market's big indexes are headed toward a loss for the week, the Standard & Poor's 500 is still up 32 percent since March 9.

Dow Jones industrial average futures fell 37, or 0.5 percent, to 8,249. Standard & Poor's 500 index futures fell 5.80, or 0.7 percent, to 883.70, while Nasdaq 100 index futures fell 8.75, or 0.7 percent, to 1,345.

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Bond prices rose. The yield on the 10-year Treasury note slipped to 3.08 percent from 3.09 percent late Thursday.

The dollar rose against other major currencies, while gold prices fell.

Light, sweet crude fell 80 cents to $57.82 in electronic trading on the New York Mercantile Exchange.

In overseas stock trading, Japan's Nikkei stock average rose 1.9 percent. In late morning trading, Britain's FTSE 100 was down 0.1 percent, Germany's DAX index was down 0.2 percent, and France's CAC-40 was down 0.4 percent.

[Associated Press; By MADLEN READ]

Copyright 2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


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