Nasdaq drops 1.9% as hot US CPI revives October hike bets
What's new: Traders lifted the odds of an October Fed rate increase to 37% from 22%, hitting AI and chip stocks hardest.
US stocks fell Wednesday after September inflation came in hotter than expected, reviving fears that the Federal Reserve could raise interest rates again this month. The Nasdaq Composite sank 1.88% to 26,692.87, its biggest one-day drop since July 23, while the S&P 500 lost 1.11% and the Dow Jones Industrial Average slipped 0.09%. Technology shares led the selloff as higher-rate expectations pressured expensive growth names tied to the AI boom. Oracle fell 8.8%, CoreWeave dropped 15%, Nebius lost 10%, Dell slid 11.4% and Hewlett Packard Enterprise fell 8.2%. Traders raised the implied chance of an October rate hike to 37% from 22% a day earlier, according to CME FedWatch.