US stocks fall as hotter inflation fuels rate-hike concerns, NAGA Group says
SPY•The S&P 500 fell 1.11% and the Nasdaq 100 dropped 2.02% as September inflation exceeded forecasts; the probability of an October rate hike rose to 37% from 22%.
1. Stocks and inflation
The S&P 500 fell 1.11% on Wednesday, while the Nasdaq 100 dropped 2.02%, with semiconductor and AI-related stocks under pressure. September headline inflation reached 3.7%, above the 3.6% forecast, while core CPI rose 2.6%, above expectations of 2.5%.
2. Rate outlook and earnings
The probability of a 25-basis-point rate hike at the October 27-28 FOMC meeting rose to 37% from 22% before the CPI release. Third-quarter S&P 500 earnings growth was forecast at 25% year over year, up from July's 22% estimate.
