Global stock market measures declined while the U.S. dollar rose on Wednesday after U.S. consumer inflation data soared to its highest level since 1990 has sparked the possibility for the Federal Reserve (Fed) to tighten monetary policy sooner than expected.
CPI data rose 0.9% on a monthly basis as a result of a 0.4% increase in September as the biggest gain in 4 months drove the annual increase at 6.2%.
It was its biggest annual increase since November 1990 and followed a 5.4% jump in September and according to Reuters economists had forecast the overall CPI to rise 0.6%.
The CBOE Volatility Index which measures Wall Street market risk hit its highest level in almost 1 month.
The world MSCI index declined 0.71% following a decline on Wall Street while the STOXX 600 index climbed 0.22% during the highest closing session following strong gains from the media and energy sectors.
According to Refinitiv data, profits of companies listed on STOXX 600 are expected to jump 60.7% in the third quarter to 104.4 billion Euros ($ 120.7 billion) from the previous year.
The Dow Jones Industrial Average was down 0.66%, the S&P 500 was down 0.82% and the Nasdaq Composite plunged 1.66% as a result of the decline of US mega -cap companies. Growth stocks fell 1.26% but stock value was only 0.29%.
The dollar surged following CPI data while the Euro hit a 16 -month low against the US dollar.
The dollar index, which measures the US dollar, rose 0.914% to 94.886.
The Euro fell 0.97% at $ 1.1479 while the Yen rose 0.95% at $ 113,9200.
The benchmark US 10 -year treasury yield rose 11.4 basis points to 1.5630% in late trading on Wednesday after hitting its 6 -week low of 1.4150% on Tuesday.
European zone bond yields also rose with Germany’s benchmark 10 -year yield up 4 basis points at -0.243% above its 7 -week low of -0.299% on Tuesday.
Oil prices plummeted as the dollar rose after President Joe Biden said the U.S. administration was looking for ways to reduce energy costs during the upcoming inflation surge.
Brent crude oil price fell $ 2.14 at $ 84.64 a barrel and US crude oil price fell $ 2.81 at $ 81.34 a barrel.
US gold prices closed 1% higher at $ 1,848.30 an ounce.
Bitcoin was down 1.64% at $ 65,844.
