US open: Stocks little changed amid disappointing data and mixed corporate earnings

US stocks struggled for direction early on Wednesday, as investors digested a disappointing reading on retail sales and a number of corporate earnings reports.

Shortly before 1500, the Dow Jones Industrial Average was down seven points to 17,075.34, while the S&P 500 and the Nasdaq were four and 16 points higher respectively.

Retail sales disappoint

The Department of Commerce said retail sales rose 0.1% month-on-month compared with a flat reading in the previous month and with analysts’ expectations for a 0.2% increase.

"The softness of September’s retail sales figures supports our view that the Fed probably isn’t going to hike interest rates until early next year," said Paul Ashworth, chief US economist at Capital Economics.

"We now estimate that third-quarter real consumption growth was around 3.0% annualised, which is still healthy enough, but not quite as good as the 3.6% gain that we were anticipating."

Meanwhile, according to the Labor Department, wholesale prices declined 0.5% month-on-month in September driven lower by the sharpest drop in gasoline prices since January.

The decline was bigger than the 0.2% drop analysts had forecast and was also lower compared to the flat reading registered in the previous month.

Elsewhere, applications for US home mortgages tumbled last week, as the Mortgage Bankers Association revealed its index of finance application activity slumped 27.6%.

Earnings in focus

In company news, Intel slid 3.43% after the IT giant reported slower growth in its data-centre businesses, although its quarterly profit beat forecasts.

JP Morgan Chase & Co was down 2.43% after saying late on Tuesday its quarterly revenue fell short of expectations.

Among the companies that reported before the bell, BlackRock gained 2.09% after its quarterly results beat analysts’ expectations, while Bank of America climbed 2.26% after swinging to a third quarter profit, although revenue declined year-on-year.

Netflix and SLM are scheduled to report after the close.

Worries over China slowdown intensify

Elsewhere, Asian markets fell on Wednesday, after China’s National Bureau of Statistics said the consumer price index rose 1.6% year-on-year in September compared with a 2% increase in August and with analysts’ expectations for a 1.8% gain.

“We expect the fall in consumer price inflation to be temporary,” said Julian Evans-Pritchard, China economist at Capital Economics.

“CPI and PPI are likely to pick-up markedly, easing concerns over deflation.”

The dollar was on the back foot against the main currencies, losing 0.31% and 0.48% against the yen and the euro respectively. The greenback also declined 1.10% against the pound, while gold futures rose 0.72% to $1,177.20.

European stocks were in the red, while oil prices fell, with West Texas Intermediate losing 0.69% to $46.34 a barrel, while Brent edged 0.26% lower to $49.11 a barrel.