* Consumer prices drop in Nov; manufacturing picks up in Dec
* 'Fiscal cliff' still preoccupies investors
* Futures: S&P up 0.7 pts, Dow up 23 pts, Nasdaq down 9 pts
By Leah Schnurr
NEW YORK, Dec 14 Wall Street was set to open
little changed as investors digested the latest round of
economic data, while concerns about a lack of progress by
politicians in ongoing fiscal negotiations remained at the
S&P 500 index futures gave up earlier gains shortly after
data showed consumer prices fell in November for the first time
in six months, indicating inflation pressures were muted.
Separate data showed manufacturing grew at its swiftest pace in
eight months in December.
The consumer price data "shows that despite all the action
by the Federal Reserve to stimulate the economy, we are still
seeing very little, if any, inflation in the system," said Tim
Ghriskey, chief investment officer of Solaris Group in Bedford
Hills, New York.
Meanwhile, data out of China was encouraging for its key
trading partners, including the U.S., and for the prospects for
world economic growth. It showed manufacturing in the world's
second-largest economy grew at its fastest pace in 14 months in
Shares of Apple were down 2.4 percent at $516.80 in
premarket trading as UBS cut its price target to $700 from $780.
Apple will also release its iPhone 5 in China on Friday but
its longer-term hopes may depend on new technology being tested
by China's top telecoms carrier.
President Barack Obama and House of Representatives Speaker
John Boehner held a "frank" meeting Thursday to try to break an
impasse in negotiations over the "fiscal cliff," tax hikes and
spending cuts set to kick in early in 2013.
Frustration has mounted over the lack of progress in the
discussions, with market participants' worries reflected in a
0.6 percent drop in the S&P 500 on Thursday. Investors are
concerned that going over the cliff could tip the economy back
into recession. While a deal is expected to be reached
eventually, a drawn-out debate - like the one seen over 2011's
debt ceiling - can erode confidence.
"I think the market is convinced, due to the fact that we
haven't seen much of a pullback, that some (fiscal) compromise
will happen before the end of the year," said Art Hogan,
managing director of Lazard Capital Markets in New York.
"The bad news is, in large part, we've seen the market
ignore relatively good news in the economic data stream as we
focus on the fiscal cliff," he said.
Worries over the outcome of the talks ended the S&P 500's
six-day winning streak on Thursday, but the index has performed
well over the past month. On Wednesday, the S&P hit its highest
intraday level since late October.
S&P 500 futures rose 0.7 point but were below fair
value, a formula that evaluates pricing by taking into account
interest rates, dividends and time to expiration on the
contract. Dow Jones industrial average futures gained 23
points, and Nasdaq 100 futures fell 9 points.
Schlumberger fell 3.6 percent to $69.93 after it
said lower drilling activity would hurt its fourth-quarter
Adobe Systems jumped 5.2 percent to $37.36 in
premarket trading after the company said it expected profit and
earnings to grow from 2013 onwards.