Top line

Shares fell on Wednesday, with the Dow Jones Industrial Average dropping over 200 points after the consumer price index rose by its highest level in 30 years in October, adding to investor fears that high inflation could ruin the recent market rally .

Important facts

The Dow fell 0.7% to over 200 points, while the S&P 500 was down 0.8% and the tech-heavy Nasdaq Composite was down 1.7%.

The consumer price index – a key measure of inflation – rose 6.2% year over year in October, the fastest increase in 30 years, according to data from the Bureau of Labor Statistics on Wednesday.

The latest report showed that inflation is not slowing: frightened investors have dumped soaring tech stocks and taken refuge in hedges like gold and bitcoin, while government bond yields have also skyrocketed.

According to the latest inflation data, the market is now betting that the Federal Reserve may have to hike rates earlier than expected, with the first rate hike expected as early as July 2022.

Big tech stocks plummeted as investors turned their backs on growth stocks on Wednesday: Amazon, Google parent Alphabet, and Facebook parent Meta all fell around 2%.

Tesla regained some of its losses this week after shares rose 4.3%, while rival electric vehicle maker Rivian rose 29% after going public with a $ 90 billion valuation – the largest US IPO since Facebook in 2012.