Wall Street tumbles as hot inflation data feeds worries about Fed rate hikes
SPY•Wall Street fell after September inflation rose more than expected, increasing bets on another Federal Reserve rate hike. The S&P 500 dropped 1.35%, the Nasdaq fell 2.02% and the Dow lost 0.51%.
1. Inflation weighs on stocks
U.S. consumer prices accelerated in September as gasoline costs surged and price pressures broadened beyond energy. Traders priced in a 37% chance of a rate hike at the Fed’s meeting this month, up from 22% on Tuesday.
2. Technology shares slide
Oracle fell 7.3%, while AI-infrastructure firms CoreWeave and Nebius dropped 15% and 10%. Dell lost 12% and Hewlett Packard Enterprise fell 7.6% after Barclays downgraded both AI server makers. The Philadelphia semiconductor index fell nearly 4%, extending its losing streak to six sessions.
3. Banks and market breadth
Bank of America fell 5.8% after its third-quarter profit declined and it set aside $1.2 billion for potential regulatory fines. Morgan Stanley dropped 3.8% despite higher quarterly profit. Decliners outnumbered advancers in the S&P 500 by 1.7 to one, and the Nasdaq recorded 466 new lows against 22 new highs.
