US stocks gave up gains on Wednesday to close lower as the market weighed inflation trends and negative sentiment over the economy. After gains over the first two days of the week, the Dow Jones Industrial Average dropped 269.24 points, losing 0.8%.
The flip also saw the S&P 500 decline 1%, and the Nasdaq Composite shed 0.7% as the indexes teetered ahead of key inflation data later in the week.
Economist and Wharton professor Mohamed El Erian says the Fed has been “incredibly slow” to act on inflation.
“The Fed hasn’t been late when it comes to pumping liquidity… when it comes to making the difficult decision, this Fed in general has been incredibly slow,” he told CNBC. “If I were fully invested right now, I would take some chips off the table.”
The market is also not helped by the fact that the 10-year US Treasury yield rose again to hit above 3%, currently 6 basis points up at 3.029%.
Elsewhere in the market, oil prices rose by more than 2% to hit a 13-week high, with Brent crude hitting $123.36 a barrel and WTI crude rising to $122.41 a barrel. The jump in oil prices follow expectations of increased demand in China.
Gold rose marginally to $1,885.80 per ounce, while Bitcoin was holding above $30,000, down about 2% in the past 24 hours.
Among individual stocks, Robinhood shares tanked 3.9% in a late afternoon downturn after SEC chair Gary Gensler announced rule change proposals to overhaul Wall Street’s trade execution of retail trades.