Dow tumbles 680 points hot inflation reading spooks investors

U.S. stocks declined sharply on Wednesday as hotter-than-expected inflation data triggered massive selling, especially in technology shares. The Dow Jones Industrial Average fell 681.50 points, or 2%, to 33,587.66, posting its worst day since January. The blue-chip benchmark tumbled as much as 713 points at its session low. The S&P 500 lost 2.1% to 4,063.04 for its biggest drop since February, while the tech-heavy Nasdaq Composite slid 2.7% to 13,031.68, bringing its weekly decline to more than 5%. Ivestors have been fearful of a pick-up in inflation as it could squeeze margins and erode corporate profits. NB: factis inflation is great for corporate profits sice big corporations raise prices on the inflation excuse and then add some If price pressures run too hot for a sustained period of time, the Federal Reserve would be forced to tighten monetary policy. “There are people who think the Fed is not just behind the curve, they’re maybe missing the point and by the time they start to play catch up, it’s too late,” Wall Street veteran Art Cashin said Wednesday on CNBC’s “Squawk on the Street.”  Tech shares, which have been under pressure this week and this month, led the decline again Wednesday as bond yields jumped. Shares of Microsoft, Netflix, Amazon and Apple all fell more than 2%, while Tesla slid over 4%. Alphabet dropped more than 3%. Strength in energy shares, which could do well in an inflationary environment, provided the broader market with some cushion. Occidental Petroleum climbed 2.4%. Chevron and Marathon Oil gained slightly. The Technology Select Sector SPDR is off by 5.6% this week and 6%, as investors reassess the group’s high valuations in the face of rising inflation. The Cboe Volatility Index, also known as Wall Street’s fear gauge, popped above 28 at its session high during Wednesday’s stock rout. The VIX is a measure of fear or expected volatility in the markets computed from option prices on the S&P 500. Nick Note: we saw out and out panic selling yesterday. A velocity break out to the downside. I believe with the SLIGHT possibility of skid marks a significant bottom has been put in. We need to get the PPI report behind us to get the markets to settle down. To be clear here supply shortages caused by shutdowns have created the TEMPORARY  price spikes. Car prices increases an important of the CPI were driven by supply disruptions since the suits fucked up and did not keep their parts pipelines full. They have rum out of $5.00 chips that stops them for producing a $50,000 VEHICLE customers are screaming for. Remember pickup trucks and the like are worker bee tools. Blue collar types need their tool wagon… pickemuptrucks, And worker bee mamies need the soccer SUV to get the kiddies off to day care and school. When you weren’t working no need for the car. Many people sold them off for cash. Now its back to work they go and they need transportation……  ITS A TEMPORARY REFLATION NOT INFLATION………..