Retail, Labor, Producer Price Data on Thursday's Economic Calendar

Includes: DIA, QQQ, SPY
by: optionMONSTER

By Bryan McCormick

Today boasts the heaviest economic calendar of the week, with producer prices, retail sales, and jobs data all coming out at 8:30 a.m. ET. That will make the pre-market a potentially volatile session, ahead of business inventories and testimony from Federal Reserve Chairman Ben Bernanke at 10 a.m. ET.

The Producer Price Index is expected to show a non-seasonally adjusted gain of 0.6 percent. The so-called core rate is forecast to rise by a small 0.2 percent.

The range for the headline number, which includes fuel and food, is from a non-inflationary 0.3 percent at the low to a highly inflationary 1.3 percent at the high. Inflation is a big concern among traders in all markets, so a surprise on the upside would likely be bearish and signal the potential for tightening of monetary policy.

Retail Sales is expected to show a gain of 0.6 percent with and without autos included, a relatively rare convergence. Including autos, estimates range from a bearish 0.2 to a very bullish 1.2 percent. The range is even wide without autos, from a bearish 0.1 percent to a bullish 1.5 percent.

Initial claims--which are part of the Jobless Claims report--are expected to come in at 430,000, an improvement from last week's 474,000. Forecasts range from a bullish 400,000 to a bearish 465,000. A number at or higher than the previous week's tally would be bearish, while a reading below 400,000 would be bullish.

Business Inventories will be released at 10 a.m. ET, with a forecast that calls for a gain of 0.8 percent. Higher inventories, as long as sales keep pace, are considered bullish.

Businesses do not build inventories unless they are confident of future sales. The range of values for this report is from a potentially bearish gain of just 0.4 percent to a bullish 1 percent. Sales that are well under the inventory rate are generally considered bearish.