Stock market news live updates: Stocks slump after the S&P 500 touches new lows

Stock market news live updates: Stocks slump after the S&P 500 touches new lows

U.S. stocks were on pace for another week of sharp losses Friday after a vicious sell-off that sent the S&P 500 to lows not seen since 2020.

The bellwether index was flat at open, while the Dow Jones Industrial Average ticked down around 0.2%. The technology-focused Nasdaq Composite was off by 0.3%.

Investors will close out a brutal month and quarter on Friday. The S&P 500’s 2.1% drop on Thursday marked its 49th decline of 1% or more this year, marking the most downside volatility since 2009, according to Compound Advisors’ Charlie Bilello. For the month, the index is down roughly 8%, the Dow roughly 7%, and the Nasdaq about 3%.

In economic releases, the Federal Reserve’s preferred inflation gauge showed prices climbed more than expected in August. The personal consumption expenditures (PCE) price index rose 0.3% last month after retreating in July. On an annual basis, the PCE price index increased 6.2%. The so-called core PCE price index — which excludes the volatile food and energy components of the measure — rose 4.9% year-over-year in August, up from a 4.7% increase in July.

Meanwhile, the Commerce Department reported Friday that consumer spending increased 0.4% last month after slipping 0.2% in July.

On the corporate front, Nike (NKE) was among early movers on Friday after the company reported a 44% surge in inventory and outlined other macroeconomic headwinds that weighed on the quarter. Shares plunged 13% at the start of trading despite earnings that came in line with expectations and reaffirming its full fiscal sales outlook.

Chipmaker Micron Technology (MU) shares nudged roughly 2% higher even as the company warned about tough times ahead for PC and smartphone demand and said it was slashing investments. Micron, however, forecast strong revenue growth in the second half of fiscal 2023, projecting a recovery in demand by that point.

After an abrupt policy shift by the Bank of England earlier this week to restart bond purchases, investors in the U.S. had fleeting hopes the Federal Reserve may follow suit and ease the pace of its aggressive monetary stance. On Thursday, the odds of a softer 50-basis-point hike at the central bank’s November meeting rose above 50% but retreated back to around 40% as traders assessed hawkish Fedspeak and the lowest reading on jobless claims in five months.

U.S. Federal Reserve Board Chairman Jerome Powell arrives to host an event on “Fed Listens: Transitioning to the Post-pandemic Economy” in Washington, U.S., September 23, 2022. REUTERS/Kevin Lamarque

In an interview with CNBC on Thursday, Federal Reserve Bank of Cleveland President Loretta Mester asserted she and her peers will maintain restrictive policy until inflation subsides and distinguished the U.K.’s market turmoil from conditions in the U.S.

“Market functioning is incredibly important because you won’t be able to hit any monetary policy goals if the markets aren’t functioning,” Mester said. “That’s different than worrying about volatility in the markets,” adding that so far there has been no dysfunction in U.S. markets.

Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc

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