Equity markets were mostly flat on Monday but pulled back nearly 1.0% last in the day as traders brace for another round of economic data. The list kicks off today with a read of the PPi and it should be another hot one at 0.4% month to month. If so, it will underpin the idea that consumer-level inflation is yet to cool off despite the recently weakened CPI report. Also on tap, this week is Retail Sales and the Index of Leading Indicators, which the market often overlooks.

In other news, the New York Fed's inflation gauge shows the expectations for short and long-running inflation have increased. This could lead the FOMC to act aggressively at the next meeting although some members have indicated it may be appropriate to slow the pace of hikes soon. The takeaway is that inflation is still hot, the data is still iffy, and the FOMC is on track to hike rates above 5.0% by early 2023. With interest rates on the rise and the outlook for earnings in decline, the rally in the S&P 500 may not get far if it's not already over.