Dollar gains, Wall Street stocks fall after hot inflation data
SPY•The dollar rose and Wall Street stocks fell after September core CPI increased 0.3% from August, above the 0.2% forecast. Traders raised the odds of a Federal Reserve rate increase this month to about 33%, from around 20% before the data.
1. Inflation lifts rate bets
US core consumer prices rose 0.3% in September from August, compared with economists’ 0.2% forecast. Core CPI rose 2.6% annually, above the 2.5% forecast, while headline inflation increased 3.7%, also exceeding estimates.
2. Dollar rises, stocks fall
The dollar rose 0.35% against a basket of currencies to its highest since April 2025, and two-year Treasury yields gained 1.5 basis points to 4.81%. Traders raised the chance of a Federal Reserve rate increase this month to about 33%, from around 20% before the report. The Dow fell 0.09%, the S&P 500 dropped 1.11% and the Nasdaq declined 1.88%.
3. Oil and earnings in focus
Technology and communication services led Wall Street losses, while healthcare, consumer staples and energy stocks ended higher. Brent crude rose 0.35% to settle at $106.06 a barrel. Bank of America reported lower third-quarter profits, while Morgan Stanley beat profit expectations on strong equity trading.
