US STOCKS-Wall St bides time as investors await CPI, earnings

On Wednesday, the Labor Department's March Consumer Price Index (CPI) report is expected to show a slight cooldown in monthly price growth and a nominal decrease in the annual core number, which excludes volatile food and energy items. "Markets are treading water," Stovall added.

U.S. stocks waffled between modest gains and losses on Monday, with few catalysts to steer investors one way or the other ahead of crucial inflation data and the kick-off of first-quarter earnings season.

All three major U.S. stock indexes were last modestly higher, with gains held in check by the highest benchmark U.S. Treasury yields since November in the wake of Friday's blowout employment report. That report heightened chances that the Federal Reserve could delay implementing its first interest rate cut at its monthly Federal Open Market Committee meetings longer than previously expected.

"Wall Street is adjusting expectations to reflect the fact that the Fed could be slower to lower interest rates and that now the greatest likelihood is for a rate cut to occur at the July FOMC meeting, rather than June," said Sam Stovall, chief investment strategist of CFRA Research in New York. On Wednesday, the Labor Department's March Consumer Price Index (CPI) report is expected to show a slight cooldown in monthly price growth and a nominal decrease in the annual core number, which excludes volatile food and energy items.

"Markets are treading water," Stovall added. "(Investors are) waiting for the for Wednesday's CPI report with the expectation that it'll come in on target or possibly showing less inflation than may currently be anticipated." Year-on-year headline CPI is expected to gain some heat, rising to 3.4% from 3.2% in February, underscoring inflation's meandering journey back to the Fed's 2% annual target.

Federal Reserve Bank of Chicago President Austan Goolsbee said on Monday the central bank must take into consideration how long it can maintain its restrictive policy without damaging the economy. The first-quarter reporting season officially kicks off on Friday with numbers from major U.S. banks JPMorgan Chase & Co , Citigroup Inc and Wells Fargo & Co.

As of Friday, analysts expect aggregated S&P 500 earnings growth of 5.0% year-on-year, down from the 7.2% annual estimate at the beginning of the quarter, according to LSEG. At 2:08 p.m. ET, the Dow Jones Industrial Average rose 48.13 points, or 0.12%, to 38,952.17, the S&P 500 gained 6.98 points, or 0.13%, at 5,211.32 and the Nasdaq Composite added 24.67 points, or 0.15%, at 16,273.19.

Among the 11 major sectors of the S&P 500, consumer discretionary was enjoying the largest percentage gain, while healthcare stocks were down the most. Tesla provided a boost, rising 5.6% after CEO Elon Musk said the company would unveil its Robotaxi on Aug. 8.

Cryptocurrency-related stocks also outperformed, tracking rising bitcoin prices. Software firm MicroStrategy and exchange operator Coinbase Global, and added 5.4% and 7.0%, respectively. Advancing issues outnumbered decliners on the NYSE by a 1.98-to-1 ratio; on Nasdaq, a 1.61-to-1 ratio favored advancers.

The S&P 500 posted 21 new 52-week highs and two new lows; the Nasdaq Composite recorded 70 new highs and 73 new lows.