Markets shudder on dashed inflation hopes; Dow falls 1,250

[BumRushDaShow]

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 Street’s 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, it’s not the journey that’s 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 didn’t 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

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Article updated. Original article -

NEW YORK (AP) — The stock market fell the most since June 2020 following Wall Street’s humbling realization that inflation is not slowing as much as hoped. The Dow lost more than 1,250 points and the S&P 500 sank 4.3%. A hotter-than-expected report on inflation Tuesday has traders bracing for the Federal Reserve to ultimately raise interest rates even higher than expected, with all the risks for the economy that entails. Bond prices also tumbled, sending yields sharply higher, after the government reported inflation decelerated last month by less than economists forecast. The drop didn’t quite knock out the market’s gains over the past four days.

THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below.

[mnhtnbb]

1. I'm going to delete the duplicate thread I just posted

What a day.

[BumRushDaShow]

3. I was actually slow getting this up

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]

6. I used CNBC. No paywall.

[BumRushDaShow]

7. Yeah I usually look for them too

but have "breaking news" alerts set up on my iPad for others. I'll probably add their app too.

[Warpy]

4. Yeah, sic transit glorious money Might be worth a dupe

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]

2. Well poo

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]

5. For perspective, that means we are .13% (.0013) lower than we were 5 days ago.

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]

9. Those gains followed multiple days of losses

Still down substantially for the year. I lost 4x this year than my salary the last year before I retired in 2021.

[Scrivener7]

12. OK, but you have no more reason to be upset than you did 5 days ago.

I get it. I, too, retired in 2021. But things are cyclical and we knew a time like this would come.

[progree]

8. S&P 500 down 18.0% from January's all-time high, nearing "bear market territory" again

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]

10. Terrible - Our IRA just keeps losing and losing

[Backseat Driver]

11. Not much motion on inflation per report; Feds due to increase prime again next week as well?...

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]

13. shit

[Yo_Mama_Been_Loggin]

14. Inflation rose 0.1% in August even with sharp drop in gas prices

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]

15. Great time to buy, it'll bounce back

I increased my 401k contribution at work this week.

[oldsoftie]

16. And later this month the Fed will probably over react; as they usually do.

These most recent rate increases haven't really had time to work thru all the markets.
Raise .5 and then wait.

[bucolic_frolic]

17. At 14% inflation Volcker took rates north of 14%

Put on your seat belts.

[BumRushDaShow]

18. Well this economic environment is completely different from the '70s/'80s

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]

19. Ridiculous over reaction

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 aren’t sustainable (or we’re actually a scam).

These “professionals” responsible for these wild swings do us no favors