Stocks moved modestly higher on Wednesday as investors tried to find their footing after the biggest one-day drop in more than two years.
The Dow Industrial Average added 32 points, or 0.1%. The S&P 500 gained 0.2%, and Nasdaq Composite added about 0.2%.
Chevron and Merck were the top stocks in the Dow, gaining more than 1.5% each. Apple added 0.5%.
The Dow sank more than 1,200 points Tuesday, or nearly 4%, while the S&P 500 lost 4.3%. The Nasdaq Composite dropped 5.2%. It was the biggest one-day slide for all three averages since June 2020.
The market moves came afterAugust’s consumer price index report showed headline inflationrose 0.1% on a monthly basis despite a drop in gas prices.
The hot inflation report left questions over whether stocks could go back to their June lows or fall even further. It also spurred some fears that the Federal Reserve couldpotentially hike even higherthan the 75 basis points markets are pricing in.
“Tuesday’s selloff is a reminder that a sustained rally is likely to require clear evidence that inflation is on a downward trend. With macroeconomic and policy uncertainty elevated, we expect markets to remain volatile in the months ahead,” Mark Haefele, CIO of UBS Global Wealth Management, said in a note to clients.
All 30 Dow stocks and S&P 500 sectors finished the session lower, led to the downside by communications services. The sector fell 5.6% and finished its worst day since February, dragged down by shares of big technology names like Netflix and Meta Platforms, which tumbled about 7.8% and 9.4%, respectively.