Stocks slipped Tuesday after fresh data raised concerns that inflation will remain sticky.
The Dow fell 571 points, or 1.5%. The S&P 500 declined 1.6% and the Nasdaq Composite lost 2%. All three major indexes closed out April lower, snapping a five-month streak of gains. The blue-chip Dow notched its worst month since September 2022.
The Employment Cost Index rose a seasonally adjusted 1.2% last quarter, faster than the 0.9% increase the prior quarter, according to the Bureau of Labor Statistics.
Investors worry that accelerated compensation growth may serve as an inflation pressure. The latest ECI reading comes on the heels of a slew of hotter-than-expected inflation data and slowdown in US gross domestic product.
Traders are concerned that economic growth is slowing while inflation stays sticky, which could put the Federal Reserve in a bind when it comes to beginning long-awaited interest rate cuts.
The Fed began its two-day monetary policy meeting on Tuesday and is expected to announce Wednesday that it is keeping rates on hold. Investors will tune in to comments from Chair Jerome Powell for clues on when the Fed could begin easing rates. Right now, the timing is a mystery for Wall Street.
As stocks settle after the trading day, levels might change slightly.
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