• Wall Street indexes plunge as US inflation dampens hopes of Fed rate cuts in June.
• All sectors are trading lower with Real Estate and Utilities the most affected.
• The Dow Jones Index is under increasing bearish pressure below 38,540 with scope to retest 38,035 area.

Equity markets are taking a blow on Wednesday as an unexpectedly strong US inflation report has hammered hopes that the Federal Reserve (Fed) may start lowering borrowing costs in the near term.

US Consumer Prices Index (CPI) accelerated at a 0.4% pace in March, against expectations of a slowdown to 0.3%, while the yearly rate increased to 3.5% from 3.2% in the previous month. These numbers confirm that price pressures remain stubbornly high and ditch the market’s roadmap of three rate cuts in 2024, starting in June.

The risk-averse reaction to CPI data has sent the main US indices tumbling. The Dow Jones leads losses, down 1.27% to 38,383, increasing its distance from March highs near 40,000. The S&P 500 and the NASDAQ index drop 1.13% each to 5,150 and 16,117, respectively.

Dow Jones news

All Wall Street sectors are posting losses on Wednesday. Real Estate is the most affected by higher-for-longer interest rates and falls 4.24%, followed by Utilities, down 2.05%, and Materials, which gives away 1.6%. The least- affected sectors are Energy, only 0.5% lower, and Communication Services with a 0.65% decline.

Home Depot (HD) is leading losses with a 2.88% drop to $351.05, followed by Boeing (BA), 2.75% lower to $173.29, and Intel (INTL), which is losing 2.65% to $38.31. Only Walmart (WMT) is in the green on Wednesday with a 0.7% advance to $60.20.