By Chuck Mikolajczak
NEW YORK (Reuters) - U.S. stocks were set for a modestly lower open on Thursday indicating the S&P 500 will retreat from its most recent all-time high, as investors grappled with the latest batch of corporate earnings and economic data.
After a lackluster start to the new year on concerns stock valuations may be extended, the S&P 500 has rallied 1.6 percent over the past two sessions to set its first record high since December 31.
Economic data pointed to an economy that continues to grow at a slow, but steady pace.
The consumer price index increased 0.3 percent after being flat in November while the core CPI, which strips out volatile food and energy prices, rose only 0.1 percent, slowing from a 0.2 percent gain in November which suggested underlying inflation is muted.
Initial claims for state unemployment benefits slipped 2,000 to a seasonally adjusted 326,000 and claims for the prior week were revised to show 2,000 fewer applications received than previously reported, indicating a sharp slowdown in job growth in December was likely to be temporary.
"We've made a nice run and the market is entitled to consolidate and use sort of a 'wait-and-see' attitude as far as earnings are concerned," said Terry Morris, senior equity manager for National Penn Investors Trust Company in Reading, Pennsylvania.
Earnings are due from 12 S&P 500 components on Thursday. Goldman Sachs was flat $178.75 and BlackRock Inc shares gained 3.1 percent to $322.50 in premarket trade after fourth-quarter results.
However, Citigroup Inc dropped 2.5 percent to $53.60 after its quarterly results.
S&P 500 futures fell 3.8 points and 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 declined 32 points and Nasdaq 100 futures lost 2 points.
Data on manufacturing and the housing market is due later in the session at 10 a.m. (1500 GMT).
The Philadelphia Federal Reserve's gauge of manufacturing activity in the Mid-Atlantic region for January is expected to show a reading of 8.6 versus 6.4 in the prior month. The National Association of Home Builders housing market index for January is expected to show a 58 reading, equal to December's.
Best Buy Co Inc shares plunged 30.4 percent to $26.16 in premarket trade after the No. 1 consumer electronics chain reported a drop in holiday sales and forecast a bigger-than-expected decline in quarterly operating margins.
Dow component UnitedHealth Group Inc reported a higher fourth-quarter profit and the addition of 170,000 members, and said 2014 earnings would improve as well. However, shares of the largest U.S. health insurer lost 1.1 percent to $74 in premarket trade.
CSX Corp lost 6.4 percent to $27.37 before the opening bell after the railroad late Wednesday posted a smaller fourth-quarter profit on weak coal volume.
Apollo Global Management LLC said it would buy CEC Entertainment Inc , the parent of Chuck E Cheese restaurant chain, for about $948 million. CEC shares jumped 13 percent to $54.70 before the opening bell.
(Reporting by Chuck Mikolajczak; Editing by Nick Zieminski)