NEW YORK: Wall Street stocks fell sharply early Tuesday after US inflation exceeded expectations, pointing to a slower easing of restrictive Federal Reserve monetary policy.
The consumer price index for January cooled, but not as much as analysts had expected, pushing back the timeframe towards reaching the Fed’s two percent target.
The data was “not Fed friendly,” said Nationwide’s Kathy Bostjancic, alluding to the central bank’s signaling that it could cut interest rates when inflation is contained.
US stocks stable ahead of consumer price data
About 20 minutes into trading, the Dow Jones Industrial Average was at 38,356.70, down 1.1 percent, retreating from Monday’s record.
The broad-based S&P 500 fell 1.3 percent to 4,955.42, while the tech-rich Nasdaq Composite Index slumped 1.8 percent to 15,662.67.
The inflation index rose 3.1 percent from a year ago, while “core” CPI stripping out volatile food and energy components, rose 3.9 percent.
Analysts have said the market could be poised for a pullback after more than three months on the upswing. A note from Briefing.com characterized Tuesday’s trading as “profit-taking.”
Comments
Comments are closed for this article.