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.
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