Stocks slide as worries about inflation revive: Stock market news today

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Stocks fell on Wall Street on Wednesday, on track for another losing day as lingering concerns about inflation spurred doubts the Federal Reserve will decide to cut interest rates any time soon.

In midday trading, the S&P 500 (^GSPC) was down about 0.9%, while the Dow Jones Industrial Average (^DJI) dropped around 0.7%, as losses deepened throughout the morning and early afternoon. The tech-heavy Nasdaq Composite (^IXIC) was down more than 1%.

WTI crude oil (CL=F) is trading around its highest level since November, after touching $90 on Tuesday after Saudi Arabia and Russia stuck with output cuts. That reignited worries about “sticky” inflation and weighed on stocks, helping push all three major US gauges to close lower on Tuesday.

With the Fed’s September 20 meeting on the horizon, investors are debating whether those price pressures will convince policymakers to keep rates higher for longer.

At the same time, downbeat data out of Europe and China are driving worries about crumbling demand, which could undermine the resilience that the US economy has shown so far. A surprisingly sharp fall in German industrial orders in July fueled speculation of a risk of stagflation.

Given that, eyes were on fresh PMI data on the US services sector in August, closely watched for signs of inflation. The ISM reading came in at 54.5, compared with 52.5 expected, for the eighth month of higher activity in a row.

Earlier, the US trade deficit widened less than expected in July, as exports rose 1.6% after three months of declines, official figures showed. Also on deck is the release of the latest Fed Beige Book.

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