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I would expect stocks to take a breather today after reaching new multi-year highs on Thursday with the help of positive labor market and manufacturing readings. On the docket today we have the Industrial Production and Michigan Confidence readings on deck for release a little later, while the inflations numbers came broadly in-line with expectations.

Favorable economic reports may not be enough to power stocks higher today. But this rally has defied predictions thus far, so I wouldn’t be overly surprised if stock quote pages show a lot of green later this afternoon (perhaps in honor of St. Patrick's Day?).

The Consumer Price Index (CPI) for February came broadly in-line with market expectations, up 0.4% on the ‘headline’ after January's 0.2% increase. ‘Core’ CPI, which strips out food and energy, also matched expectations, up 0.1% after January’s 0.2% increase. The year-over-year readings were 2.9% for the ‘headline’ and the ‘core’ reading at 2.2%.

The increase in the ‘headline’ reading from last month reflects the recent surge in gasoline prices, but the Fed’s statement following the latest FOMC meeting characterized inflationary pressures as temporary. That may be so, but these elevated readings will keep the central bank from going for another round of bond purchases. The upturn in treasury bond yields in recent days is essentially a reflection of the lower odds of further Fed action. Stock market investors, on the other hand, have been taking this new Fed outlook in the stride.

In corporate news, United Parcel Service (UPS - Analyst Report) is reportedly in talks to acquire TNT Express, the second largest delivery company in Europe. TNT had last month rejected UPS’s $6.4 billion bid, but appears to be now negotiating with the company. In other news, the third iteration of Apple’s (AAPL - Analyst Report) iPad goes on sale today to the all-too-familiar long waiting lines outside of store by loyal fans. Women’s clothing and accessories retailer New York & Company (NWY - Snapshot Report) came out with a lower-than-expected loss after the close on Thursday, but it missed revenue expectations.

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