NEW YORK: Wall Street stocks fell early Thursday after wholesale price inflation rose more than expected, adding to worries about further Federal Reserve interest rate hikes.
The producer price index, a measure of wholesale inflation, bounced 0.7 percent in January from December, topping estimates.
The data is the latest to show a mixed impact of Fed interest rate hikes thus far on US economic activity.
Wall St slides as inflation data, policymakers stoke rate worries
Stocks on Wednesday advanced on optimism about the world’s biggest economy, following strong retail sales.
But on Thursday, investors were rattled by the rise in yield on the 10-year US Treasury note, which hit its peak for 2023 and is seen as a proxy for US interest rate policies.
About 15 minutes into trading, the Dow Jones Industrial Average was down 1.0 percent at 33,787.56.
The broad-based S&P 500 shed 1.2 percent to 4,097.77, while the tech-rich Nasdaq Composite Index dropped 1.4 percent to 11,906.85.
“This disinflation trend that was becoming the narrative just hit a major road bump,” said Oanda’s Edward Moya.
“This market is not correctly pricing in how much tightening we could still get,” he added.
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