Investors Digest Inflation Report, Stocks Take Pounding

Stocks slumped and interest rates spiked Wednesday after consumer prices rose more than expected in January, raising concern that inflation may reignite.The Dow Jones Industrials plummeted 337.61 points, to 44,260.04The S&P 500 slumped 33.97 points to 6,034.51The tech-heavy NASDAQ dipped 71.78 points to 19,572.07. A broad selloff ensued following the release of CPI. Shares of most mega-cap technology stocks, including Amazon, Microsoft and Alphabet, declined. Consumer shares at risk if rates spike like Home Depot also traded lower, along with bank stocks that could be hurt if the economy slows under the weight of higher rates.Tesla bucked the trend and gained more than 2%. Intel and Palantir also traded higher, helping curb losses. CVS Health shares popped more than 14% on a major fourth-quarter earnings beat.January’s consumer price index jumped 0.5% for the month, putting the annual inflation rate at 3%. Both were more than the 0.3% and 2.9% increases expected by economists polled by Dow Jones. Excluding volatile food and energy prices, core CPI rose 0.4% on the month and 3.3% for the past 12 months, both higher than expected.Prices for the 10-year Treasury were bruised, raising yields to 4.65% from Tuesday’s 4.54%. Treasury prices and yields move in opposite directions.Oil prices settled $1.23 to $72.09 U.S. a barrel. Prices for gold slid $15.90 an ounce to $2,916.70 U.S.