Oct 13, 2017: 09:39am.
In the wake of data showing stubbornly high inflation, investors packed into safer assets as they braced for further monetary policy from the Fed.
The stock market is set for its seventh day of decline.
The S&P 500 and tech-laden Nasdaq fell more than 2% before the market opened, reversing earlier 1% gains, and are on pace for their seventh day of losses.
The Labor Department reported that consumer prices rose 0.4% from August to September and 8.2% from a year ago.
The 10-year U.S. Treasury note's yield jumped to 4% from 3% a week ago, while the dollar index rose 1%.
After the inflation reading, the price ofcryptocurrencies tanked.
The producer price index is a key inflation measure. The 0.4% increase in producer prices from August to September was better than expected. The stock market crashed after the consumer price index reading was released, with the S&P falling by 3.9% or more, the largest single day decline for each index. When interest rates rise, companies are less willing to borrow money and consumers are less willing to spend money.
The S&P has suffered two six-day losing streaks in a year before.
Citigroup, JP Morgan Chase, Morgan Stanley and Wells Fargo all report earnings. The financial results of the major banks are expected to be robust, but the market will focus on recession indicators such as how many loans the institutions are giving out and how well capitalized the banks are. It is important for the market to know what the banks have to say about the economy. Jamie Dimon, CEO of JP Morgan Chase, said this week that the U.S. will probably enter a recession in the next six to nine months.
The inflation was worse than expected.
The S&P 500 hasn't done anything since last year. It was not good, according toForbes.
Does the Federal Reserve want you to lose your job? It'sComplicated. There is a magazine called "Forbes."
Higher unemployment may be necessary to tame inflation.
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