Wall Street wavers, crude slides on demand softness, CPI in view
Stocks mixed a economic worries meet rate cut hopes
CPI report on tap
Banks under pressure after Barr's bank capital plan revisions
JPMorgan Chase's interest income warning further rattles sector
Oil dips as OPEC+ lowers demand forecast
Updates to 14.43 EDT
By Stephen Culp
NEW YORK, Sept 10 (Reuters) -U.S. stocks were mixed on Tuesday and crude prices dipped as concerns over softening global demand held risk appetite in check a dayahead of inflation data.
Market participants were girding for the Labor Department's consumer price index (CPI) report, and the first debate between Vice President Kamala Harris and former President Donald Trump, who are locked in a tight race for the White House.
Data from China showing a spike in exports appeared to be in anticipation of tighter tariffs from trading partners, including the incoming U.S. administration.
Megacap tech and tech-related stocks helped boost the Nasdaq into positive territory, while the S&P 500 eked out more modest gains and the blue-chip Dow languished in the red.
"It really feels like today is kind of a calm before the storm," said Ryan Detrick, chief market strategist at Carson Group in Omaha. "We obviously have the first presidential debate between Trump and Harris later this evening, but then we have the CPI inflation data tomorrow and investors are kind of on strike right now with no major buying or selling."
Shares of big banks were under pressure after Federal Reserve Vice Chair for Supervision Michael Barr unveiled sweeping bank capital plan revisions.
The sector was further rattled afterJPMorgan Chase JPM.N issued an interest income warning as interest rates are expected to ease.
The warning from JPMorgan Chase "is a reminder that there still are some cracks in the economy as we head into the end of the year," Detrick added.
Wednesday's CPI report is expected to show inflation drifting closer to the Federal Reserve's 2% target, reflecting Fed Chair Jerome Powell's belief that price growth is under control, and softness in the labor market suggests the time has come for a policy rate cut.
Financial markets are baking in a 71% likelihood that the central bank will cut its Fed funds target rate by 25 basis points at the conclusion of its monetary policy meeting next week, with a 31% chance of a supersized 50 basis point rate cut, according to CME's FedWatch tool.
"Investors are firmly focused on what the Fed is going to do, and on economic reports," said Oliver Pursche, senior vice president at Wealthspire Advisors, in New York. "So far, the data indicates that the most likely scenario is a soft landing or very mild recession."
The Dow Jones Industrial Average .DJI fell 133.12 points, or 0.33%, to 40,696.47 the S&P 500 .SPX gained 17.2 points, or 0.31%, to 5,488.25 and the Nasdaq Composite .IXIC added 119.85 points, or 0.71%, to 17,004.46.
European stocks turned negative, weighed by bank and energy stocks as investors took a cautionary stance ahead of U.S. inflation data and an anticipated rate cut from the European Central Bank later in the week.
The pan-European STOXX 600 index .STOXX lost 0.54% and MSCI's gauge of stocks across the globe .MIWD00000PUS gained 0.07%.
Emerging market stocks lost 0.07%. MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS closed 0.08% higher, while Japan's Nikkei .N225 lost 0.16%.
U.S. Treasury yields dipped ahead of the debate and Wednesday's CPI report.
Benchmark 10-year notes US10YT=RR last rose 16/32 in price to yield 3.6404%, down from 3.699% late on Monday.
The 30-year bond US30YT=RR last rose 27/32 in price to yield 3.9518%, down from 3.999% late on Monday.
The dollar inched higher against a basket of world currencies.
The dollar index .DXY rose 0.06%, with the euro EUR= down 0.07% to $1.1026.
The Japanese yen JPY= strengthened 0.62% versus the greenback at 142.32 per dollar, while Sterling GBP= was last trading at $1.3082, up 0.08% on the day.
Oil prices slid and Brent dipped below $70 per barrel for the first time since December 2021 as a lower demand forecast from OPEC+ offset potential U.S. supply concerns due to Tropical Storm Francine.
U.S. crude CLcv1 tumbled 4.31% to settle at $65.75 per barrel, while Brent LCOcv1 settled at $69.19 per barrel, off 3.69% on the day.
Gold firmed above the $2,500 level as investors positioned themselves ahead of the CPI report.
Spot gold XAU= added 0.4% to $2,515.74 an ounce.
World FX rates YTD http://tmsnrt.rs/2egbfVh
Global asset performance http://tmsnrt.rs/2yaDPgn
Asian stock markets https://tmsnrt.rs/2zpUAr4
Inflation gauges https://reut.rs/3AVhRDj
Reporting by Stephen Culp; Additional reporting by Amanda Cooper in London; Editing by Jonathan Oatis and David Gregorio
To read Reuters Markets and Finance news, click on https://www.reuters.com/finance/markets For the state of play of Asian stock markets please click on: 0#.INDEXA
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