European markets moved cautiously higher this morning. In the U.K., consumer price inflation rose to 2.7% in May from 2.4% in April, meaning that inflation remains above the Bank of England's 2% target. In Germany, cable TV operator Kabel Deutschland hit a record €85 per share following news that Liberty Global had submitted a bid for the firm, which recently received an informal offer from Vodafone. As of 7:15 a.m. EDT, the FTSE 100 is up 0.76%, the German DAX is flat, and Spain's IBEX 35 is up 0.64% despite news that bad debt levels in Spanish banks rose to 10.9% in April from 10.5% in March.
In the U.S., investors are likely to be cautious ahead of tomorrow's Fed meeting. At 8:30 a.m. EDT, May's Consumer Price Index report will be published. Consensus forecasts suggest that inflation rose by 0.2% in May after falling 0.4% in April. Low inflation is seen to be supportive of further Fed easing, so markets may react positively if inflation is at or below expectations. Also due at 8:30 a.m. EDT are May's housing-starts and building-permits reports. Expectations call for a rise in housing starts to 953,000 last month from 853,000 in April. The number of new building permits issued in May is expected to be 973,000, down 2.7% from April.
In corporate news, few companies are scheduled to report earnings today. FactSet Research Systems is expected to report third-quarter earnings of $1.15 per share before this morning's opening bell. After the close tonight, Adobe Systems is expected to report second-quarter earnings of $0.34 per share, while La-Z-Boy is expected to report fourth-quarter earnings of $0.27 per share. Other stocks that could be actively traded this morning include Sony, which is 2.8% higher in premarket trading following reports that Daniel Loeb's hedge fund, Third Point, has increased its stake in the firm. Netflix may also be actively traded after closing up 7% yesterday following news of its new deal with DreamWorks Animation.
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