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Stocks fell on Wednesday after a hotter-than-expected producer price index reading and as traders awaited the Federal Reserve’s rate policy decision.
The Dow Jones Industrials dumped 422.34 points to observe noon EDT at 46,570.92
The S&P 500 index slumped 36.8 points to 6,679.29.
The NASDAQ stumbled 124.5 points to 22,355.07.
With respect to earnings, eyes are on Micron Technology, as the chipmaker is slated to release its latest quarterly results after the bell Wednesday. The stock has been on a tear this year, rallying nearly 62% amid soaring demand for high-bandwidth memory.
The producer price index — which tracks the change in wholesale prices — rose 0.7% in February, well above the 0.3% economists polled by Dow Jones had estimated. The report shows that inflation was already in a precarious spot prior to the Iran war breaking out — an event that has heightened stagflation fears amid rising oil prices.
Investors are now looking ahead to the Fed’s interest rate decision expected on Wednesday. Markets are expecting the central bank to keep interest rates unchanged in a range between 3.5% to 3.75%.
Traders will be watching for any guidance from Fed Chair Jerome Powell on whether oil prices could impact future monetary policy
Prices for the 10-year Treasury settled, raising yields to 4.23% from Tuesday’s 4.20%. Treasury prices and yields move in opposite directions.
Oil prices gained $2.02 to $98.23 U.S. a barrel.
Gold prices stumbled $137.60 to $4,870.60 U.S. an ounce.
