Wall Street plunges on rising inflation fears, dimming hopes for a June rate cut

From Fox 5 San Diego: 2024-04-10 14:17:38

Stocks plunged on Wall Street as concerns over rising inflation overshadowed hopes for rate cuts by the Federal Reserve. The S&P 500 dropped by 0.9%, the Dow Jones fell by 1.1%, and the Nasdaq composite sank by 0.8%. Treasury yields also increased, adding pressure to the market.

The fear of sustained inflation is pushing up prices and causing worry among investors. The market had been buoyed by expectations of a rate cut by the Federal Reserve to boost the economy, but recent inflation data suggests the Fed may hold off on rate cuts.

The release of higher-than-expected inflation data caused prices for bonds and gold to fall. Treasury yields rose, with the 10-year yield jumping to 4.54%. Traders are now less optimistic about rate cuts, shifting towards expectations of fewer rate cuts this year.

High interest rates negatively impact the economy and investment prices. Real estate and utility stocks suffered the most on Wall Street, with real estate stocks in the S&P 500 falling by 4.1%. Homebuilders also saw declines due to concerns about higher mortgage rates.

The stock market saw losses across major indexes, with the S&P 500 falling to 5,160.64, the Dow dropping to 38,461.51, and the Nasdaq composite declining to 16,170.36. Critics had emphasized that U.S. stocks were overpriced, leading to hopes that the strong U.S. economy would support profits.

Delta Air Lines kickstarted the earnings season on a positive note, reporting strong demand for flights but refraining from raising full-year profit forecasts. Investors are now waiting for banking industry reports, with JPMorgan Chase and Wells Fargo set to release earnings.



Read more at Fox 5 San Diego: Stock market today: Wall Street falls after hot inflation report burns hopes for a June rate cut