Producer Price Inflation “Rising,” Wall Street Returns to the Red
US stocks weakened on Friday (February 27th) after the latest Producer Price Index (PPI) data came in much hotter than expected, adding to a growing list of market concerns this month—from stubbornly declining inflation to concerns about the impact of AI on several economic sectors.
The Dow Jones Industrial Average plunged 535 points, or 1.1%. The S&P 500 fell 0.6%, while the Nasdaq Composite fell 0.9%. All three major indexes remain in the red for February, reflecting fragile market sentiment.
In addition to inflation, the market is also unsettled by growing concerns that AI-driven automation could disrupt business models in several industries and impact the broader economy. These concerns intensified after Jack Dorsey's fintech company, Block, announced plans to lay off more than 4,000 employees—nearly half of its workforce.
Correspondingly, stocks in the financial sector and sectors sensitive to economic cycles also experienced corrections, indicating that investors are starting to reduce their risk exposure as the combination of "sticky" inflation and uncertainty about the direction of growth once again dominates the market.
Source: Newsmaker.id
