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Morning Reading: Gridlock, Downgrades, and Data

What to watch, courtesy of Yahoo! Finance's Elizabeth Trotta:

Good morning!

World stocks advanced and stocks in the U.S. are approaching a higher open this morning ahead of the consumer price index, the most widely used gauge of inflation after jobless claims and manufacturing data on Thursday were better than expected.There is little relief for the banks however, as Fitch, the third largest credit ratings agency, cut its ratings on Goldman Sachs, Bank of America, Citi, BNP Paribas, Deutsche Bank, Barclays and Credit Suisse.

Washington continues to attract attention Friday as lawmakers reached a deal to keep the government running but are still trying to reach a final agreement on payroll tax cuts. Lawmakers, had raced up against the clock — again -- to approve the spending measure, continuing a year plagued by government shutdown threats. (Read: Congress Getting Failing Marks on Economy in Year of Gridlock)

Another group getting bad marks: Hedge funds. The one-time darling of the investing world has thus far posted another year of dumpy results -- the average fund lost 4.4% in the first 11 months of the year, data from Hedge Fund Research shows. (Read: Investors Falling Out of Love With Hedge Funds) Of course, some hedge funds did very well, others did very poorly -- the real gamble seems to be picking the right one.

Economic Data to Watch:

8:30 a.m.: Consumer Price Index (Expected 0.1%, Prior 0.1%) Economists expect CPI to reflect that consumers paid higher prices for food but less for gas in November. (Click here to read about what to expect, and here to see the release at 8:30 ET)

Next week holds a battery of housing data and a bit of a look at the consumer as well, here's what's on the schedule:

Monday -- NAHB Housing Market Index

Tuesday -- Housing Starts and Building Permits

Wednesday -- MBA Mortgage Index, Existing Home Sales and Crude Oil Inventories

Thursday -- Jobless Claims, Updated GDP Estimate, Univ. of Michigan Consumer Sentiment Index and FHFA Housing Price Index

Friday -- Durable Goods, Personal Income and Spending and New Home Sales

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