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Day Ahead: Top 3 Things to Watch

Investing.com - Here’s a preview of the top 3 things that could rock markets tomorrow. 1. CPI Expected to Edge Up Economic

Investing.com - Here’s a preview of the top 3 things that could rock markets tomorrow.

1. CPI Expected to Edge Up

Economic attention will be on retail inflation tomorrow.

The Labor Department will issue the January consumer price index (CPI) at 8:30 AM ET (13:30 GMT).

Overall, economists expect retail inflation to remain tame.

The CPI is forecast to show a 0.1% rise for January and a 1.5% year-on-year gain, according to Investing.com.

The core CPI, which excludes volatile food and energy prices, is expected to climb 0.2% for the month and 2.1% over the 12 months through January.

2. Cisco Cut Today, Reports Tomorrow

Among earnings reports, the main action will be after the bell.

Cisco Systems (NASDAQ:CSCO) will issue its results tomorrow.

On average, analysts expect that the networking giant earned 72 cents per share, with revenue of about $12.4 billion.

Morgan Stanley (NYSE:MS) downgraded the stock today, just ahead of earnings, cutting it to equal weight from overweight and lowering the price target to $49 from $51.

The brokerage said Cisco is still executing on security, but may find it difficult to offset deceleration in the hardware cycle.

Also tomorrow after the bell, TripAdvisor (NASDAQ:TRIP) will be reporting numbers and Yelp (NYSE:YELP) will issue results.

3. Oil Inventories Seen Rising Again

Saudi jawboning to push prices higher helped crude rise today. But a reversal could come quickly tomorrow if inventory numbers show continued strength in U.S. production.

OPEC said today it expected demand for its oil to decline to 30.59 million barrels per day (bpd) this year -- some 240,000 bpd lower than what it anticipated in January -- due to higher U.S. production.

Analysts expect that U.S. oil inventories rose by 2.7 million barrels in the latest week.

Gasoline inventories are also expected to rise, but distillate stockpiles, which include heating oil, are forecast to fall as freezing temperatures grip the country.