Nasdaq 100 futures tumble on hot inflation report. Tech stocks under pressure as Treasury yields soar. US CPI comes in hotter than expected, 8.3% YoY vs. 8.1% exp.
The Nasdaq 100 index is under significant pressure during Tuesday’s session following a hotter-than-expected CPI print this morning. The CPI gauge for August came in at 8.3% YoY, while core came in at 6.3%. Both readings came in above market expectations, which saw risk dramatically sell off as traders repriced Fed expectations.
Nasdaq shares fell the hardest, as high-valuation names felt the brunt of soaring US Treasury yields. Cloudflare sank by more than 10%, while hedge fund favorite Carvana tumbled over 12%. Tech heavyweights were also under pressure, with the NYSE FANG+ index down by more than 5%. Tuesday’s inflation print may force the market to rethink the narrative surrounding a “soft landing,” with market pricing for Fed hikes shifting dramatically. Should the Fed’s terminal rate be higher than where it is currently priced, high-multiple stocks may remain vulnerable. It would appear that the market had gotten ahead of itself over the last week in pricing in “peak inflation,” and more pain could be ahead.
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