U.S. stocks close lower amid inflation worries-Xinhua

U.S. stocks close lower amid inflation worries

Source: Xinhua

Editor: huaxia

2024-03-16 07:29:45

NEW YORK, March 15 (Xinhua) -- U.S. stocks ended lower on Friday, as traders were reacting to the hotter-than-expected inflation data released earlier this week.

The Dow Jones Industrial Average fell 190.89 points, or 0.49 percent, to 38,714.77. The S&P 500 sank 33.39 points, or 0.65 percent, to 5,117.09. The Nasdaq Composite Index shed 155.36 points, or 0.96 percent, to 15,973.17.

Seven of the 11 primary S&P 500 sectors ended in red, with technology and communication services leading the laggards by losing 1.29 percent and 1.18 percent, respectively. Meanwhile, energy and utilities led the gainers by rising 0.23 percent and 0.12 percent, respectively.

Investors wrapped up a week of economic data indicating that while inflation is generally moderating, it remains higher than anticipated. These reports have sparked concerns about the Federal Reserve's upcoming decision on interest rates, although there is still optimism on Wall Street for a possible rate cut in June. Fed Chair Jerome Powell emphasized that the central bank was seeking increased assurance that inflation would reach its 2 percent target.

"The Fed meeting next week has probably become more important or more impactful than we thought," said Shannon Saccocia, chief investment officer of NB Private Wealth.

Meanwhile, bond yields increased, with the yield on the 10-year U.S. Treasury note -- a key gauge for borrowing rates across various sectors such as mortgages and corporate loans -- rising to 4.303 percent from the previous week's 4.088 percent.

Also on Friday, Adobe's stock declined by 14 percent despite the software company surpassing expectations in its latest results. However, investors were disappointed by the guidance provided for the current quarter. Ulta Beauty also experienced a 5.2 percent drop in its stock price after warning of slowing growth in the beauty industry and offering full-year earnings guidance that fell short of Wall Street's expectations. On a positive note, Fisker's shares rose by 13 percent following reassurances from the troubled electric-vehicle maker regarding talks of a potential bankruptcy filing.

B. Riley Wealth Management's chief investment strategist Paul Dietrich issued the alarming call in a commentary titled "The Stock Market Bubble Is About to Burst - Look Out!" He compared the buying frenzy to the feverish demand for lottery tickets when the jackpot passes 750 million dollars: "That's when everyone starts to go insane."

Dietrich also said the S&P 500 would have to slump 13 percent to return to its 200-day moving average and emphasized that the benchmark index tumbled an average of 36 percent during a recession.