U.S. stocks fall as hot inflation revives Fed rate-hike bets

U.S. stocks closed lower Wednesday after a hotter-than-expected September inflation report revived bets on further Federal Reserve rate hikes. The Dow fell 0.09 percent, the S&P 500 dropped 1.11 percent, and the Nasdaq declined 1.88 percent. The consumer price index grew 0.6 percent month over month and 3.7 percent year over year in September, up from 0.4 percent and 3.4 percent in August. Technology led declines with a 2.62 percent drop, while defensive sectors like Health Care and Consumer Staples gained. Traders priced a 37 percent chance of a Fed hike at the Oct. 28 meeting, up from 22 percent Tuesday. The 10-year Treasury yield spiked above 5.32 percent before easing to 5.186 percent. Oil prices rose on Middle East supply concerns, with WTI settling at 95 dollars a barrel. Bank of America tumbled 4.76 percent after disappointing profit, while AI-linked stocks fell sharply, with the Philadelphia Semiconductor Index down 4.3 percent.