U.S. stocks settled mixed on Wednesday, with the Dow Jones Industrial Average dropping more than 400 points following the release of the Personal Consumption Expenditures (PCE) price index. The Dow closed lower by around 444 points to 50,906.05.
The PCE price index, the Federal Reserve’s preferred gauge for inflation, rose 0.3% month over month in August. This reading came in below the 0.4% consensus estimate. Core PCE, which excludes food and energy prices, increased by 0.2%, versus expectations of 0.3%. The cooler-than-expected data strengthened the case for Treasury bonds.
Market sentiment showed slight improvement on Wednesday. The CNN Money Fear and Greed Index stood at 31, remaining in the “Fear” zone, compared to a prior reading of 29. The index ranges from 0 to 100, with 0 representing maximum fear and 100 signaling maximum greed.
Separately, ADP reported that private payrolls rose by 90,000 in September, exceeding the consensus estimate of 68,000. However, most sectors on the S&P 500 closed in the red, with health care, consumer staples, and industrials recording the biggest losses. Information technology and consumer discretionary stocks were the only major sectors to finish higher.
Investors are awaiting earnings results from Acuity Inc., Accenture Plc, and Nike Inc. later in the day.
