Stocks Plunge as Inflation Spikes
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Stocks plunged Friday on news that consumer inflation jumped in November.
The CPI up 0.8% on the headline number and 0.3% with food and energy costs stripped out followed Thursday's news that wholesale inflation had its biggest gain in 34 years.
Together, the two reports suggest that the Federal Reserve might not have much room to cut interest rates to stem a meltdown in credit markets and prevent the economy from falling into recession.
eBay and Amazon lost ground on a negative report on the e-commerce sector by Bear Stearns.
Silicon Motion, Amtech and Clearwire were double-digit gainers, while CDC plunged 20% after reporting a loss.
A number of tech names will report earnings next week, including Adobe, Oracle, Research in Motion and Micron Technology.
The Nasdaq lost 32 to 2635, the S&P fell 20 to 1467, and the Dow tumbled 178 to 13,339. Volume declined to 3.36 billion shares on the NYSE, and 1.94 billion on the Nasdaq. Decliners led by a 26-7 margin on the NYSE, and 22-8 on the Nasdaq. Downside volume was 84% on the NYSE, and 70% on the Nasdaq. New highs-new lows were 48-242 on the NYSE, and 61-251 on the Nasdaq.