Stock Market Today: Stocks tumble after CPI inflation shock
Inflation data, Powell testimony, a 10-year auction and potentially new tariffs will keep Wall Street on alert Wednesday.
Check back for updates throughout the trading day
U.S. equity futures moved sharply lower Wednesday, while Treasury bond yields and the dollar spiked higher, as investors picked through a hotter-than-expected January inflation report while bracing for another round of tariff announcements from President Donald Trump.
Updated at 8:41 AM EST
Inflation redux
U.S. inflation ticked surprisingly higher in January, data indicated Wednesday, sending stocks sharply lower as price pressures remained stubbornly elevated even prior to the impact of new trade tariffs put in place by President Donald Trump.
The Commerce Department said its headline Consumer Price Index for January was pegged at an annual rate of 3%, accelerating from the 2.9% pace recorded in December and the fastest level since May.
So-called core inflation, which strips out volatile components like food and energy, quickened to an annual rate of 3.3%, topping Wall Street's 3.1% forecast and pegged at the highest rate since May.
U.S. stocks extended declines following the data release, with futures contracts tied to the S&P 500 indicating a 60 point decline and those linked to the Nasdaq priced for a 230 points slide. The Dow was last called 445 points lower.
Benchmark 2-year Treasury note yields rose 7 basis points to 4.363% while 10-year notes jumped 7 basis points to 4.619%.
The U.S. dollar index, which tracks the greenback against a basket of six global currencies, was marked 0.5% higher at 108.441.
Headline CPI was 0.47%, also above expectations. This dragged the 12-month rate up to 3% (vs 2.9% in Dec)
The six-month annualized rate was 3.6% (vs. 2.9% in Dec) and the three-month annualized rate was 4.5% (up from 3.5%). pic.twitter.com/Yh2KtWcC3m— Nick Timiraos (@NickTimiraos) February 12, 2025
Updated at 8:11 AM EST
Jawboning rates
President Trump renewed his call for lower interest rates, posting through his Truth Social social media account that a Federal Reserve rate cut would go "hand in hand" with is recent tariff announcements.
The post comes just 30 minutes ahead of the January CPI inflation release, which is expected to show headline price pressures holding at 2.9% on an annual basis, but easing to around 0.3% when compared to December.
Core prices, meanwhile, are expected to ease to 0.3% on the month and to a year-on-year rate of 3.1%.
