Dow tumbles nearly 700 points for worst day in 6 months as inflation worries spark stock-market rout

The U.S. stock market on Wednesday finished sharply lower for a third straight session, with the declines on the session driving the Dow and S&P 500 perilously close to a breach below of their short-term trend lines for the first time since March amid a selloff that was at least partly fueled by a reading on inflation that came in at the highest rate in about 13 years. The April CPI report reignited fears that the Federal Reserve may need to dial back its easy money policies earlier than expected. The S&P 500 index closed down 2.2% at 4,063, putting the broad-market index near its 50-day moving average at 4,049.95, a trend line it hasn’t breached since March 25, according to FactSet data. It was the third straight drop for the index and its worst day since Feb. 25. The Dow Jones Indusrial Average closed 681.50 points, or 2%, lower to 33,588, approaching its 50-day moving average at 33,318.84, which it hasn’t fallen below since early March. It was the blue-chip gauges worst day since Oct. 28, when it fell 943 points or 3.4%. The Nasdaq Composite Index , meanwhile, ended down 2.7% to 13,031, deepening its slide beneath its 50-day moving average. The U.S. consumer-price index rose 4.2% from a year ago, compared with average economists’ estimates surveyed by Econoday for a 3.6% increase. The month-over-month rise was 0.8%, versus a forecast for a rise of 0.2%. Overall, the rise was the fastest rate of climb since September 2008.

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