Futures added to previous gains Tuesday after retail sales fell less than expected in May and producer price index climbed.
Retail sales, which provide a snapshot of consumption, fell for the first time in 11 months, although the decline was less than expected. Total retail sales slipped 0.2 percent, according to the Commerce Department. Economists had forecast retail sales falling 0.4 percent, according to Reuters.
Meanwhile, the Producer Price Index, which measures price changes before they reach the consumer, increased 0.2 percent in May, according to the Labor Department, down sharply from a 0.8 percent rise in April and a 0.7 percent increase in March.
Excluding the volatile food and energy categories, the core index also increased 0.2 percent, driven by higher prices for plastics, clothing and new cars. The core index has risen 2.1 percent in the past year.
“The way that the markets been trading these days, market’s been very short sighted on positive news and focused on negative news,” said Michael Gault, senior portfolio strategist for Weiser Capital Management.
Gault noted that economic news in the last few weeks has been poor and the markets are going to need a “greater macro picture” to see a “more consistent and a less volatile road ahead.”
Futures were initially boosted after the Chinese central bank raised reserve ratios requirement for banks for the ninth time since last October after data showed inflation rising to its highest level in almost three years.
Analysts said the data suggested a measured slowdown of the Chinese economy and this encouraged investors to go into risky assets. But economist Nouriel Roubini said China is facing a "meaningful probability" of a hard landing.
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