This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Inflation Data Sink Stocks

Updated from 4:18 p.m. EST

Stocks in the U.S. fell Friday as the latest round of inflationary data led investors to fear that the Federal Reserve might be reluctant to lower rates again.

The Dow Jones Industrial Average dropped 178.11 points, or 1.32%, to 13,339.85, and the S&P 500 was down 20.46 points, or 1.37%, at 1467.95. The Nasdaq Composite was off 32.75 points, or 1.23%, at 2635.74.

The major averages finished with losses of more than 2% over the five sessions, ending a two-week winning streak.

Breadth was negative. On the New York Stock Exchange 3.36 billion shares changed hands, and volume on the Nasdaq reached 1.94 billion shares. Losers beat winners roughly 3 to 1.

"Technically, this is a bad place for the market to close, especially on a Friday," said Paul Mendelsohn, chief investment strategist with Windham Financial. "There was nothing today that was really positive. There was a lack of buying, and we may see that problem as people window-dress from here until the end of the year."

The decline followed a hotter-than-expected read on inflation at the retail level. The Labor Department's consumer price index rose 0.8%, compared with expectations of a 0.6% increase. The core number -- which excludes food and energy -- climbed 0.3%, slightly above estimates.

Investors fear that the unexpected jump in the CPI affirms the Fed's concerns of rising inflation and dampens the hopes for any further rate cuts. The central bank reduced the fed funds rate by 25 basis points on Tuesday but noted higher energy prices as a potential concern for inflation.

1 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Submit an article to us!
SYM TRADE IT LAST %CHG
BAC $16.44 0.00%
C $54.17 0.00%
DIS $111.03 0.00%
JPM $64.72 0.00%
JBLU $21.58 0.00%

Markets

DOW 18,070.40 +46.34 0.26%
S&P 500 2,114.49 +6.20 0.29%
NASDAQ 5,016.9290 +11.5380 0.23%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs