* The Dow Jones drops -3.94%, the S&P-500 -4.32% and the Nasdaq -5.16%
* Unexpected rise in consumer prices in August
* Fed rate hike of at least 75 bps increasingly likely
by Stephen Culp
NEW YORK, Sept 13 (Reuters) – The New York Stock Exchange ended lower on Tuesday as an unexpected rise in consumer prices bolstered fears that the Federal Reserve’s interest rate hike would continue at a brisk pace.
The Dow Jones index cd -3.94%, or 1,276.37 points, 31,104.97 points.
The broader S&P-500 lost 177.72 points, or -4.32%, to 3,932.69 points.
The Nasdaq Composite fell by its side from 632.84 points (-5.16%) to 11,633.57 points.
The three major US equity indices ended in negative territory, after four straight sessions, and recorded their biggest one-day percentage decline in more than two years.
Rising risk sentiment pushed all major sectors into negative territory, notably interest rate sensitive markets and the technology sector, with Apple, Microsoft and Amazon.com weighing the most on the latter.
“This reaction is not a surprise given the rally that preceded the publication of the data,” said Paul Nolte portfolio manager at Kingsview Investment Management.
Consumer prices in the United States rose again in August, as higher rents and food prices overshadowed lower prices at the pump, and annual inflation slowed less than expected, statistics showed on Tuesday. by the Department of Labor.
Currency markets are now pricing in an 81% chance of a 75 basis point rise and 19% of an even bigger 100 point rise on September 21, according to the real-time barometer FedWatch.
“The Fed has raised (interest rates) three percentage points over the past six months,” Paul Nolte said. “We haven’t felt the full impact of all these increases yet, but it will come.”
“We are on the brink of recession.”
All 11 S&P sector indices ended in the red, with the communication services, consumer discretionary and technology sectors posting the biggest declines.
* The reminder of the session in Europe:
* TO BE FOLLOWED ON WEDNESDAY:
(Report Devik Jain, Ankika Biswas and Sinead Carew; French version Camille Raynaud)