Wall Street falls as inflation and AI stocks drag markets

Wall Street fell sharply on Wednesday after new inflation data came in higher than expected, with AI-related stocks acting as a major drag on the market. The Dow Jones Industrial Average dropped 0.1 percent, the S&P 500 fell 1.1 percent, and the tech-heavy Nasdaq composite declined 1.9 percent. The annual inflation figure was the highest since May and slightly above market forecasts, raising fears of another interest rate hike. A broad decline in AI-linked stocks, including Nvidia, Broadcom, Qualcomm, AMD, and Micron, pulled the market down further. Bank of America also fell 4.8 percent after a $1.5 billion fine for money laundering violations. The inflation report and AI stock selloff overshadowed gains in European markets, where Frankfurt, London, and Paris all closed higher. The declines reflect investor anxiety over persistent price pressures and the potential for tighter monetary policy.