New York, September 11
US stocks closed lower on Thursday for a fourth consecutive session as surging oil prices and stronger-than-expected wholesale inflation strengthened expectations of further interest rate hikes.
The Dow Jones Industrial Average fell 316.56 points, or 0.60 percent, to 52,064.10. The S&P 500 dropped 44.66 points, or 0.58 percent, to 7,591.70, while the tech-heavy Nasdaq Composite declined 171.62 points, or 0.65 percent, to 26,081.73.
Nine of the 11 major S&P 500 sectors ended lower. Materials led the declines, falling 1.48 percent, followed by utilities, which dropped 1 percent. Communication services and consumer staples bucked the broader trend, gaining 0.25 percent and 0.24 percent, respectively.
Oil prices climbed sharply after US President Donald Trump said Wednesday that elevated fuel costs could persist through the upcoming midterm elections.
West Texas Intermediate crude for October delivery jumped $6.43, or 6.69 percent, to settle at $102.48 a barrel on the New York Mercantile Exchange. Brent crude for November delivery rose $6.42, or 6.34 percent, to close at $107.63 a barrel on the London ICE Futures Exchange.
Inflation concerns also weighed on investor sentiment following the release of US wholesale price data on Thursday.
The US Department of Labor reported that the Producer Price Index (PPI) rose 5.4 percent year-on-year in August. The core PPI, which excludes food and energy prices, increased 4.6 percent over the same period.
Persistent inflation, combined with rising energy prices, prompted traders to increase their expectations of further monetary tightening.
According to the CME Group’s FedWatch tool, the probability of a 25-basis-point interest rate increase at the US Federal Reserve’s upcoming policy meeting rose to 73 percent, up from 64 percent before the PPI data was released.
In corporate trading, shares of enterprise software company Oracle fell more than 5 percent during regular trading but jumped nearly 7 percent in after-hours trading after the company reported better-than-expected quarterly results.
Apple shares gained 3.56 percent following the launch of the company’s first foldable smartphone.
Investors are now awaiting Friday’s release of the August Consumer Price Index (CPI), the final major inflation indicator before the Federal Open Market Committee meets next week to decide on interest rates.
