Wall Street declined during Wednesday's trading session (Oct 14) after US inflation data for September came in higher than expected, driving up US government bond yields. The S&P 500 fell 0.6%, the Nasdaq Composite dropped 0.8%, and the Dow Jones Industrial Average slipped 32 points (0.1%), though gains in UnitedHealth and Amgen shares helped cushion the decline.
The Consumer Price Index (CPI) rose 0.6% month-over-month and 3.7% year-over-year, exceeding the 3.6% annual forecast. Meanwhile, core inflation rose 0.3% monthly and 2.6% annually, also slightly above market projections. The data reignited concerns that inflationary pressures in the US remain robust.
Treasury yields surged immediately following the release of the inflation report. The 10-year yield rose more than 7 basis points to 5.293%, while the 30-year yield climbed over 4 basis points to 5.609%. Rising yields reinforced expectations that interest rates would remain high for longer, putting pressure on stock valuations, particularly in the technology sector.
Market pressure was further exacerbated by high energy prices. US gasoline prices remained well above year-ago levels, while WTI crude contracts rose approximately 1% to around US$95 per barrel. Persistently high energy prices threaten to sustain inflationary pressure and limit the Federal Reserve's room to loosen monetary policy.
Among individual stocks, Bank of America fell 7%, while Morgan Stanley dropped nearly 2% despite beating earnings expectations. Semiconductor stocks also faced renewed pressure; Micron Technology fell 1%, AMD declined 3%, and both Intel and SanDisk dropped approximately 2%. Investors are becoming increasingly cautious, as a combination of high inflation, rising yields, and lofty earnings expectations poses a major challenge for Wall Street.