U.S. stocks are little changed his morning as the Federal Open Market Committee's June policy meeting gets under way. The S&P 500 (^GSPC 0.11%) and the narrower, price-weighted Dow Jones Industrial Average (^DJI 0.56%) are up 0.29% and 0.42%, respectively, at 10:15 a.m. EDT.
The macro view: Inflation Tuesday
And speaking of Fed policy, Consumer Price Index data for the month of May was released this morning. The Consumer Price Index for All Urban Consumers -- the most popular measure of inflation -- rose by 0.1% last month on a seasonally adjusted basis.
Stripping out food and energy, the core inflation index rose 0.2% on a seasonally adjusted basis after rising just 0.1% during each of the prior two months. Year on year, the core index is up 1.7% (unadjusted) -- close to the Fed's 2% inflation target. These results help dispel the fear of disinflation or deflation, thereby diminishing one obstacle to the "tapering" of the Fed's bond-buying program. Of course, we should know more about which way the Fed is leaning on this issue following the conclusion of the FOMC meeting tomorrow.
The micro view: Airbus vs. Boeing
Airbus CEO Fabrice Bregier is showing a bit of swagger. First, in an interview with The Wall Street Journal, he said he expected the company to raise its operating profit margin to 10% by 2015.
He then followed up with an interview with the Financial Times yesterday in which he took direct aim at his competitor, Dow component Boeing (BA 1.10%), saying he sees "no reason why [Airbus] would not expect - if we continue to do a good job -- to lead [the market for wide-body, twin-engine aircraft]."
Although Airbus' A-350 is 18 months behind its original schedule, Bregier is increasingly confident the company will deliver the plane to its first customer by mid-2014, in line with its revised timeline. Three versions of the A-350 will go head to head with Boeing's 787 Dreamliner.
As far as investors are concerned, one area in which Airbus has an advantage over Boeing is valuation: The shares of Airbus parent EADS NV trade for just less than 13 times the next 12 months' earnings-per-share estimate, versus 15.1 for Boeing. In truth, however, neither of these blue-chips looks particularly attractive at this time. Investors would probably do just as well to put their money in an index fund.
