A hotter-than-expected inflation print knocked the broader market on Wednesday, with specific weakness in technology stocks.
 | WED, MAY 12, 2021 | | | | DOW | | NAME | LAST | CHG | %CHG | | AAPL | 122.77 | -3.14 | -2.49% | | MSFT | 239.00 | -7.23 | -2.94% | | INTC | 53.62 | -1.42 | -2.58% | |
| | S&P 500 | | NAME | LAST | CHG | %CHG | | AAPL | 122.77 | -3.14 | -2.49% | | GE | 12.82 | -0.27 | -2.06% | | F | 11.33 | -0.25 | -2.16% | |
| | NASDAQ | | NAME | LAST | CHG | %CHG | | AAPL | 122.77 | -3.14 | -2.49% | | AMD | 74.64 | -2.19 | -2.85% | | MSFT | 239.00 | -7.23 | -2.94% | |
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A hotter-than-expected inflation print knocked the broader market on Wednesday, with specific weakness in technology stocks. The Dow Jones Industrial Average lost more than 680 points for its worst day since January. The S&P 500 slipped 2.1% and the technology-heavy Nasdaq Composite dropped about 2.7%. The small-cap benchmark Russell 2000 declined more than 3%. The consumer price index report was released before the bell, showing acceleration not seen since 2008. The CPI spiked 4.2% from a year earlier, compared with the Dow Jones estimate for a 3.6% increase. Excluding volatile food and energy prices, the core CPI increased 3% from the same period in 2020, compared with estimates of 2.3%. Multiple drivers are behind the rise in inflation, including an economic reopening, fiscal stimulus and a Federal Reserve that's willing to let the economy run hot.  The reaction in equities raised concerns that the Fed is wrong about rising prices being temporary. If the central bank is incorrect about transitory inflation, market professionals fear it could begin to unwind its easy policies faster than expected and ultimately raise interest rates. "The tug-of-war has been intensified," said Quincy Krosby, chief market strategist at Prudential Financial. "How transitory is transitory?" she asked. "All this does is provide more uncertainty in a market that is still expensive. Even with the pullbacks, it's still expensive. … We'll have to see how the market factors it in. Does it see it as part of the reopening?" |
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