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Losses on the Wall are widening amid a spike in inflation

LAST UPDATE: 21:32

Wall Street is gradually widening its losses, which since yesterday has returned to a downward trajectory after a multi-day uptrend that led the indexes to successive historical records, with the investment psychology being burdened today by the jump of inflation to multi-year highs.

In particular, the Dow Jones industrial average lost 242.58 points or 0.67% and moved to 36,077.40 points, the broader S&P 500 fell 0.99% to 4,639.10 points, while the technology Nasdaq lost 1 , 91% at 15,583 points.

On Tuesday, the blue chips index lost 112.24 points or -0.31% and closed at 36,319.98 points, the S&P 500 fell 16.45 points or -0.35% to 4,685.25 points, ending an eight-day period Nasdaq lost 95.81 points or -0.60% to 15,886.54 points, after an 11-day uptrend.

Investment psychology is being hit hard by inflation today, as data released shortly before the meeting showed it had climbed to a three-decade high, sparking new fears that the Federal Reserve may have to speed up its policy tightening and move forward sooner. than expected to raise interest rates hitting stocks and bonds.

It is noted that the consumer price index increased by 6.2% compared to October 2020, as shown by data released today by the US Department of Commerce. Compared to September, the index strengthened by 0.9%, showing the largest monthly increase in the last four months. The structural index, which does not include food and energy, increased by 0.6%.

Analysts’ average estimates in a Bloomberg poll put the annual increase at 5.9%, up 0.6% from the previous month.

Additional pressure on equities is exerted by rising government bond yields, which have risen after inflation data, as rising interest rates restrict valuations of future earnings and can therefore hit “growth” stocks particularly hard. such as technology titles.

“Wednesday’s Consumer Price Index showed that inflation moved for another month well above the Federal Reserve’s target, mainly due to ongoing supply chain problems and labor shortages. If inflation does not fall, the Federal Reserve may “Tighten its monetary policy faster and raise interest rates, which could hurt stocks and bonds,” said Nancy Davis, founder of Quadratic Capital Management.

On the board, the share of the electric vehicle company Rivian, which today made its debut on the Nasdaq, marks a “jump” of 30% and moves around $ 101 each.

The DoorDash title also recorded gains of more than 10%, after it announced that it plans to acquire the European food distribution start-up Wolt, a development that is estimated to “upgrade” the company to a global player.

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