Dow Jones Plunges Amid Hot Inflation
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The Dow Jones Industrial Average fell sharply lower after hot inflation data. Twitter stock rose after shareholders voted on the offer by Tesla (TSLA) CEO Elon Musk to buy the firm. Coinbase (COIN) and Riot Blockchain (RIOT) sank as Bitcoin melted. Apple (AAPL) dived.
With the market under pressure, investors should look for stocks forming bases that could be good opportunities when the market improves. CMS Energy (CMS) and Comstock Resources (CRK) are solid examples.
Volume was running higher on the Nasdaq and the New York Stock Exchange vs. the same time Monday. This is bad sign on a down day.
The yield on the benchmark 10-year Treasury note rose six basis points to 3.42%. West Texas Intermediate crude oil fell marginally to trade at more than $87 per barrel, rebounding off lows for the day.
Inflation Data Hurts Stock MarketStocks in general were tumbling after the consumer price index showed prices rose 0.1% in August vs. the previous month. That proved hotter than estimates for a 0.1% monthly fall. Inflation rose 8.3% in August from a year ago, higher than the expected 8.1% rise.
The move saw Nomura call for a 100 basis rate hike at the September Federal Reserve Open Market Committee meeting. It had previously forecast a 75 basis point hike. It also expects a terminal rate of 4.50%-4.75% by February 2023.
"The Fed will likely have to be even more aggressive with raising rates and that is bad news for risky assets," Oanda senior market analyst Edward Moya said in a note to clients.
Nasdaq Slammed As Small Caps StruggleThe Nasdaq was struggling the most out of the major indexes. It fell 4.5% and was near lows for the day.
The S&P 500 also struggled, sliding nearly 4%. Albemarle (ALB) was a bright spot as it gained nearly 2%.
The S&P 500 sectors were all negative, with technology and communication services the worst performers. Energy gave up the least ground.
Small caps were also getting mauled by the bears, with the Russell 2000 3.5% lower.
The Innovator IBD 50 ETF (FFTY), a bellwether for growth stocks, also fell, dropping more than 2%.
Dow Jones Today: Apple Stock Reverses SharplyThe Dow Jones Industrial Average was suffering, diving more than 1,000 points, or 3.3%. It is on track for its worst day since May.
Aggressive investors who moved into Apple stock were ruing the decision after it fell over 5%. It had been the previous session's top performer but has now reversed back below its 50-day and 200-day moving averages.
AAPL stock also lost ground on an aggressive trendline entry and a handle entry of 176.25.
But Apple's losses were not as severe as those of Boeing (BA). The aerospace giant was the worst performer on the Dow Jones industrials today as it slid more than 6%.