Markets shudder on dashed inflation hopes; Dow falls 1,250
Last edited Tue Sep 13, 2022, 04:54 PM - Edit history (1)
Source: AP
NEW YORK (AP) Stocks tumbled to their worst day in more than two years Tuesday, knocking the Dow Jones Industrial Average down more than 1,250 points, following Wall Streets humbling realization that inflation is not slowing as much as hoped.
The S&P 500 sank 4.3%, its biggest drop since June 2020. The Dow fell 3.9% and the Nasdaq composite closed 5.2% lower. The sell-off ended a four-day winning streak for the major stock indexes and erased an early rally in European markets. Bond prices also fell sharply, sending their yields higher, after a report showed inflation decelerated only to 8.3% in August, instead of the 8.1% economists expected.
The hotter-than-expected reading has traders bracing for the Federal Reserve to ultimately raise interest rates even higher than expected to combat inflation, with all the risks for the economy that entails. Fears about higher rates sent prices dropping for everything from gold to cryptocurrencies to crude oil.
Right now, its not the journey thats a worry so much as the destination, said Brian Jacobsen, senior investment strategist at Allspring Global Investments. If the Fed wants to hike and hold, the big question is at what level. The S&P 500 fell 177.72 points to 3,932.69. The drop didnt quite knock out its gains over the past four days. The index is now down 17.5% so far this year.
Read more: https://apnews.com/article/inflation-asia-sydney-tokyo-hong-kong-6d893ccabafcd85f28417abcb35a6718
Article updated. Original article -
THIS IS A BREAKING NEWS UPDATE. APs earlier story follows below.
mnhtnbb
(31,402 posts)What a day.
BumRushDaShow
(129,443 posts)because I have been trying to use more paywall-less sources and passed up a WaPo and NYT breaking to use the AP one.
mnhtnbb
(31,402 posts)BumRushDaShow
(129,443 posts)but have "breaking news" alerts set up on my iPad for others. I'll probably add their app too.
Warpy
(111,339 posts)Wait until heating bills come in this winter. LNG is also a world wide market, and Europe is going to need a lot of it.
Even if the war ends and Putin is encouraged to retire and the pipelines are opened, it will take time before things are back the way they once were, if they ever are.
hibbing
(10,109 posts)Was hoping to be able to retire within the next two years, will probably take 10 to get my losses back from this year.
Peace
Scrivener7
(51,004 posts)OR, we have essentially lost 5 days of gains.
On the Dow.
S&P is still .63% HIGHER than it was 5 days ago.
MichMan
(11,971 posts)Still down substantially for the year. I lost 4x this year than my salary the last year before I retired in 2021.
Scrivener7
(51,004 posts)I get it. I, too, retired in 2021. But things are cyclical and we knew a time like this would come.
progree
(10,918 posts)which is 20% down. After yesterday's close, the S&P 500 was down 14.3% from the all-time high. What a difference a day makes. Good time to pick up stocks on sale (again )
Number9Dream
(1,562 posts)Backseat Driver
(4,394 posts)Putin set to meet with Xi in Uzbeckistan next week?
Railroads considering Biden's counseling calls?
J1/6 investigations back soon?
All the skin I got in the money casino game is spoken for already...but stocked up a bit in the freezer and a there's a lot of pancake mix, LOL!
trof
(54,256 posts)Yo_Mama_Been_Loggin
(108,192 posts)The consumer price index increased 0.1% in August. Excluding food and energy, the inflation gauge rose 0.6%, both higher than expected.
Costs were driven by increases in food, shelter and medical care services, offsetting a sharp decline in gasoline prices.
-snip-
Inflation rose more than expected in August as rising shelter and food costs offset a drop in gas prices, the Bureau of Labor Statistics reported Tuesday.
The consumer price index, which tracks a broad swath of goods and services, increased 0.1% for the month and 8.3% over the past year. Excluding volatile food and energy costs, CPI rose 0.6% from July and 6.3% from the same month in 2021.
https://www.msn.com/en-us/money/markets/inflation-rose-0-1-in-august-even-with-sharp-drop-in-gas-prices/ar-AA11M4cs
They're shitting their pants over this?
madville
(7,412 posts)I increased my 401k contribution at work this week.
oldsoftie
(12,597 posts)These most recent rate increases haven't really had time to work thru all the markets.
Raise .5 and then wait.
bucolic_frolic
(43,281 posts)Put on your seat belts.
BumRushDaShow
(129,443 posts)If anything, what happens with that threatened rail strike will impact more than anything that Powell might or might not do because that could generate an unforced error to the system if not resolved due to the types of products that get transported by rail (e.g., many of the volatile commodities like grains and fuel).
ramapo
(4,589 posts)What else is new?
Inflation is down but not as much
or it is up o.1%.
The Fed might raise rates all the way up past 3%. That seems pretty reasonable to me. You mean rates near zero arent sustainable (or were actually a scam).
These professionals responsible for these wild swings do us no favors