Stock Market Update

The stock market remains on track for a lower opening, though a relatively in-line CPI report helped futures move off their worst levels of the morning.

Total CPI increased 0.5% month-over-month in May (Briefing.com consensus: 0.5%), leaving it up 4.2% year-over-year versus 3.8% in April. Core CPI, which excludes food and energy, increased 0.2% month-over-month (Briefing.com consensus: 0.3%) and was up 2.9% year-over-year versus 2.8% in April. The energy index accounted for over 60% of the increase in the monthly all items index.

The key takeaway from the report is that core CPI was not as bad as feared, but that doesn't mean it was good. Core CPI is still running well above the Fed's 2.0% inflation target, so this report was by no means a game-changer in terms of the prevailing view that the Fed won't be cutting rates anytime soon.