Traders work on the floor of the New York Stock Exchange (NYSE) on Sept. 29, 2026 in New York City.
Spencer Platt | Getty Images
The S&P 500 pulled back on Wednesday, pressured by a move higher in Treasury yields, as investors reacted to hotter-than-expected September consumer inflation data.
The broad market index was down 0.9%, while the Nasdaq Composite shed 1.3%. The Dow Jones Industrial Average outperformed, falling just 60 points, or 0.1%, with losses kept in check by gains in key healthcare stocks such as UnitedHealth and Amgen.
The consumer price index rose 0.6% in September month over month, with its year-over-year gain coming in at 3.7%. While the former was in line with expectations, the latter was hotter than expected, as economists polled by Dow Jones had anticipated a 3.6% advance on the year.
Excluding food and energy prices, core CPI posted a monthly and yearly advance of 0.3% and 2.6%, respectively. Both were also slightly higher than the increase of 0.2% and 2.5% that economists had expected.
Treasury yields jumped following the report. The 10-year Treasury yield rose more than 7 basis points to 5.293%, and the 30-year Treasury yield up more than 4 basis points at 5.609%. Both had hit new 24-year highs last week.
“Today’s release should be a modest headwind to risk assets, as expectations for near-term rate hikes increases pressure on the long end of the curve which should strengthen the dollar but be a headwind for equity valuations,” said Jeff Schulze, head investment strategist at Franklin Templeton Institute.
The report comes as oil prices remain elevated and consumers pay more for gasoline, which is averaging at $4.34 a gallon, compared to $3.08 per gallon a year earlier, according to AAA. Last week, President Donald Trump announced he would temporarily ease restrictions on Russian diesel fuel exports, but analysts don’t believe the deal will do much to lower fuel prices for truckers and farmers.
U.S. oil prices moved higher Wednesday, with U.S. West Texas Intermediate futures up 1% at around $95 per barrel.
Bank of America shares declined 7% after the banking giant reported third-quarter results. The numbers come a day after BofA was hit with more than $1.2 billion in federal penalties, with regulators saying the bank failed to report more than $5 billion in “suspicious” transactions. Morgan Stanley‘s latest quarterly results topped expectations, though the stock was last trading nearly 2% lower.
A swath of big banks posted strong quarterly results Tuesday, but shares ended the day lower, with Goldman Sachs and Citigroup falling. The market’s reaction suggested businesses have a higher bar to clear during the third-quarter earnings season — especially in tech where semiconductors are expected to be the largest contributor to year-over-year earnings growth.
Chip stocks also added to their recent declines. Micron Technology, which shed more than 3% in the prior trading day, dropped 1%. Advanced Micro Devices also dropped 3%, while Intel and Sandisk each lost 2%.