U.S. stocks retreat after CPI data

U.S. stocks traded lower in the morning session Friday as investors pondered over the newly-released key inflation data ahead of the Federal Reserve's policy meeting next week.

By midday, the Dow Jones Industrial Average fell 72.14 points, or 0.40 percent, to 18,140.34. The S&P 500 lost 9.91 points, or 0.46 percent, to 2,137.35. The Nasdaq Composite Index was down 12.75 points, or 0.24 percent, to 5,236.93.

The Consumer Price Index (CPI) for all urban consumers increased 0.2 percent in August on a seasonally adjusted basis, beating market consensus of 0.1 percent, the U.S. Labor Department reported Friday.

Over the last 12 months, the all items index rose 1.1 percent before seasonal adjustment.

The index for all items less food and energy increased 0.3 percent in August, following a 0.1-percent increase in July.

Meanwhile, the preliminary reading of the consumer sentiment for September was unchanged at 89.8, missing market estimates, said the Thomson Reuters/University of Michigan index of consumer sentiment on Friday.

Investors kept a close eye on the Federal Reserve's two-day policy meeting scheduled to begin on Sept. 20.

Financial markets have been choppy in recent sessions on contrasting remarks by Fed officials ahead of the central bank's meeting.

On Thursday, U.S. stocks posted solid gains as Wall Street digested a slew of economic data. Enditem