NEW YORK, May 12 — Wall Street’s main indexes ended lower on Wednesday, led by a sharp drop in the Nasdaq after US inflation data did little to ease investor worries over interest rates.
The Labor Department’s monthly consumer price index (CPI) report suggested inflation may have peaked in April but is likely to stay strong enough to keep the Federal Reserve on top of cooling it down.
The CPI increased 0.3per cent last month, the smallest gain since last August, while economists polled by Reuters had forecast consumer prices gaining 0.2per cent in April.
“There was not enough of a positive surprise to underpin the market,” said Quincy Krosby, chief equity strategist at LPL Financial in Charlotte in North Carolina.
“This is a market still trying to come to grips with whether the Fed is going to be able to rein in inflation early on.”
Consumer discretionary .SPLRCD and technology .SPLRCT led declines among S&P 500 sectors. The prospect of rising interest rates has hit growth stocks especially hard.
Apple AAPL.O shares were the biggest weight on the Nasdaq and S&P 500 indexes.
According to preliminary data, the S&P 500 .SPX lost 65.51 points, or 1.64per cent, to end at 3,935.54 points, while the Nasdaq Composite .IXIC lost 370.94 points, or 3.16per cent, to 11,366.73. The Dow Jones Industrial Average .DJI fell 325.42 points, or 1.01per cent, to 31,835.32.
“There is much focus right now on Apple,” Krosby said. “Given its weighting, Apple is the bellwether for the market from many perspectives.”
Energy .SPNY shares were up and helped to limit some of the declines in the S&P 500 and Dow.
Investors are anxious to see more data on inflation Thursday, when US producer price index data is due.
Stocks are down sharply this year following concerns about how aggressively the central bank may need to raise interest rates, and over the Ukraine war and the latest coronavirus lockdowns in China.
Coinbase Global Inc COIN.O slid after its first-quarter revenue missed estimates amid turmoil in global markets that has curbed investor appetite for risk assets. — Reuters
Source: Malay Mail
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