The week ends with several data points on Friday, including two releases on output, the consumer price index, and the first monthly look at consumer sentiment. Before the open, futures are being weighed down as a result of weaker-than-expected GDP numbers from Europe; the Euro zone contracted 2.5% in Q1, half a percentage point worse than forecasts.
At 8:30 am EST, the Consumer Price Index is expected to remain unchanged for April, following a -0.1% reading in March; core prices ― which exclude volatile energy and food components ― are expected to rise 0.1% in the month, following a 0.2% advance in March.
In terms of Fed policy, inflation has taken a backseat to growth, but the CPI report is nonetheless important to investors tracking price trends. The producer price index, released on Thursday, suggests there should be few surprises in this release.
Also at 8:30 in the New York Fed’s Empire State Survey, the first manufacturing survey to be released each month. Analysts expect to see slower contraction at a rate of -12 in May, following a -15 reading in April and a record low -38 in March.
At 9:15, the nationwide Industrial Production release is set to show a 0.5% contraction in April, following two months at the -1.5% level. The quarterly contraction in the first three months of the year marked the biggest decline since 1975, as automaker shutdowns wreaked havoc on output.
The Capacity Utilization component of the report hit a record low in the prior month’s reading with a score of 69.3%.
Finally, at 10 am, the Consumer Sentiment report is expected to report a slight boost in confidence to 67.0, following a 28-low of 65.1 in April. With more than half-a-million job losses last month, don’t expect much bounce in the Reuters & the University of Michigan survey.
Aside from data, the Euro zone contraction will likely play out on investor sentiment all day long. Also in the news is that Treasury announced it will give $22 billion of TARP funds to insurance companies. Moreover, Fed chairman Ben Bernanke is reconsidering rules that favor ratings agencies such as Moody’s, S&P, and Fitch.