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Wall St. focuses on CPI
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March 21, 2001: 8:04 a.m. ET
Consumer price data to draw investors after Fed rate cut disappoints
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NEW YORK (CNNfn) - U.S. investors -- trying to pick up the pieces from weeks of stock market declines – will focus on a key inflation report Wednesday as they more fully digest the Federal Reserve's third interest rate cut this year.
Early indications from stock futures point to a lower opening for the Nasdaq market, the Standard & Poor's 500 and the Dow Jones industrial average.
Prices at the retail level will draw Wall Street's attention as the Labor Department reports its Consumer Price Index for February. Economists surveyed by Briefing.com expect the CPI rose 0.2 percent last month, tamer than the 0.6 percent rise posted in January. Excluding food and energy prices, consumer prices are expected to have risen 0.2 percent after a 0.3 percent gain the prior month.
But the CPI won't completely distract investors from the Fed's rate cut Tuesday. The half percentage point cut was seen as not enough by many investors, who sold stocks in the final hour of trading.
While U.S. investors didn't react favorably to the Fed's action, investors in Tokyo's stock market cheered the Bank of Japan's decision to cut interest rates to zero. The Nikkei index jumped 7.5 percent Wednesday, buoyed by some government securities purchases. The rest of Asia finished lower, and European issues started on the down side.
 The major U.S. stock indexes begin Wednesday at some remarkably low levels. The Dow Jones industrial average stands at 9,720.76 after falling 2.4 percent. The Nasdaq composite index is at 1,857.44, a 28-month low, after a 4.8 percent drubbing, while the S&P 500 kicks off at 1,142.62 following a more than 2 percent loss.
Treasury prices rose early Wednesday, a response to the interest rate cut and the decline in stocks. As a result, the 10-year note yield dipped to 4.76 percent from 4.78 percent late Tuesday, while the 30-year bond yield was shaved to 5.27 percent from 5.26 percent.
The dollar also seemed to get a lift from the rate cut, surging against the yen and the euro.
Technology woes continued Wednesday when computer networking equipment maker 3Com (COMS: Research, Estimates) posted a fiscal third-quarter loss that exceeded Wall Street forecasts. The company also said it plans a $1 billion restructuring that includes a reduction in the work force. 3Com shares slipped 41 cents to $6.22 Wednesday.
Deere & Co. (DE: Research, Estimates), the farm machinery maker, said Wednesday it expects to report lower fiscal second-quarter earnings as customer caution forces it to scale back production. Analysts surveyed by First Call had expected Deere to report an increase in profit. Deere shares ended at $40.33 Tuesday, down $1.04.
Package courier FedEx (FDX: Research, Estimates) is expected to report third-quarter earnings of 36 cents a share compared with 37 cents a share a year earlier. FedEx shares fell $1.68 to $40.25 Tuesday.
 Nike just did it. The athletic apparel maker late Tuesday met lowered forecasts for its fiscal third quarter and added that it's still on target to match expectations for the current quarter. The company's shares rose 39 cents to $38.40 in after-hours trading Tuesday following a $1.71 gain during the regular session.
Jabil Circuit late Tuesday lowered its outlook for the current quarter and the next one, and said it will cut an unspecified number of jobs. The electronics manufacturing contractor did report fiscal second-quarter earnings that were above analysts' forecasts. The company's shares fell $2.29 to $18.12 in Tuesday trading.
Procter & Gamble is considering a work force cut of as much as 20 percent in the face of slower economic growth, the Wall Street Journal reported Wednesday. P&G (PG: Research, Estimates) shares ended unchanged at $65.90 Tuesday.
Alcan (AL: Research, Estimates), the world's second-largest aluminum producer, is mulling making a counter-offer for Billiton, a published report said Wednesday. Alcan shares gained 29 cents to $36.40 Tuesday. 
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