Xinhua
13 May 2021, 03:19 GMT+10
NEW YORK, May 12 (Xinhua) -- U.S. stocks tumbled on Wednesday as a key inflation gauge showed higher-than-anticipated price pressures and unnerved investors.
The Dow Jones Industrial Average plunged 681.50 points, or 1.99 percent, to end at 33,587.66. The 30-stock index dropped as much as 713 points at its session low. The S&P 500 decreased 89.06 points, or 2.14 percent, to 4,063.04. The Nasdaq Composite Index shed 357.75 points, or 2.67 percent, to 13,031.68.
Ten of the 11 primary S&P 500 sectors finished in red, with consumer discretionary and technology down 3.28 percent and 2.86 percent, respectively, leading the laggards. Energy eked out a gain of 0.06 percent.
U.S.-listed Chinese companies traded lower with all the top 10 stocks by weight in the S&P U.S. Listed China 50 index ending the day on a downbeat note.
The market reactions came after data showed a stronger-than-expected jump of the U.S. consumer price index (CPI) in April.
U.S. consumer prices rose 0.8 percent in April, with a 12-month increase of 4.2 percent, the U.S. Labor Department reported Wednesday.
This marked the largest 12-month growth since a 4.9-percent increase for the period ending September 2008, according to the report.
The readings were higher than market estimates, triggering fears that the Federal Reserve may retreat from its easy money policy earlier than expected.
While the path of inflation is difficult to predict, there are a variety of reasons to expect an increase in inflation associated with reopening that is "largely transitory," Federal Reserve governor Lael Brainard said Tuesday.
"I will remain attentive to the risk that what seem like transitory inflationary pressures could prove persistent as I closely monitor the incoming data," Brainard said.
"Should this risk manifest, we have the tools and the experience to gently guide inflation back to our target," said the senior Fed official.
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