(For a live blog on the U.S. stock market, click or
type LIVE/ in a news window.)
* August CPI comes in cooler than expected
* Financials worst performers as bond yields drop
* Apple down slightly after product launch event
* Indexes down: Dow 0.65%, S&P 500 0.38%, Nasdaq 0.15%
NEW YORK, Sept 14 (Reuters) - Wall Street lost ground on
Tuesday as investors looked past lower-than-expected inflation
data, focusing instead on economic uncertainties and growing
chances of a corporate tax rate hike.
All three major U.S. indexes initially bumped higher
following the Labor Department's consumer price index report,
but optimism quickly faded and they turned negative in a
reminder that September is a historically rough month for
Dropping yields for benchmark U.S. Treasuries pressured
financial stocks and investor favor pivoted back to
growth at the expense of value.
"We're in a seesaw market," said Greg Bassuk, chief
executive at AXS Investments in Port Chester, New York. "Until
there is more consistency in the trajectory of economic
recovery, the double rotation trades we're seeing right now will
The advent of the highly contagious Delta COVID variant has
driven an increase in bearish sentiment regarding the recovery
from the global health crisis, and many now expect a substantial
correction in stock markets by the end of the year.
"Investors are still cautious," Bassuk added. "Besides the
economic data, they care about the continued spread with delta
variants, uncertainty with the Fed, as well as geopolitical
The CPI report delivered a lower-than-consensus August
reading, a deceleration that supports Federal Reserve Chairman
Jerome Powell's assertion that spiking inflation is transitory
and calms market fears that the central bank will begin
tightening monetary policy sooner than expected.
The long expected corporate tax hikes, to 26.5% from 21% if
Democrats prevail, are coming nearer to fruition with U.S.
President Joe Biden's $3.5 trillion budget package inching
closer to passage.
The Dow Jones Industrial Average fell 226.96 points,
or 0.65%, to 34,642.67; the S&P 500 lost 16.76 points, or
0.38%, at 4,451.97; and the Nasdaq Composite dropped
22.32 points, or 0.15%, to 15,083.26.
Financial stocks suffered the biggest percentage drop among
the 11 major sectors in the S&P 500, while healthcare
Apple Inc unveiled its iPhone 13 and added new
features to its iPad and Apple Watch gadgets in its biggest
product launch event of the year as the company faces increased
scrutiny in the courts over its business practices. Its shares
were last down 0.7%.
Intuit Inc gained 2.2% after the TurboTax maker
announced it would acquire digital marketing company Mailchimp
for $12 billion.
CureVac slid 8.3% after the German biotechnology
company canceled manufacturing deals for its experimental
Declining issues outnumbered advancing ones on the NYSE by a
1.74-to-1 ratio; on Nasdaq, a 1.83-to-1 ratio favored decliners.
The S&P 500 posted two new 52-week highs and two new lows;
the Nasdaq Composite recorded 45 new highs and 71 new lows.
(Reporting by Stephen Culp; additional reporting by Krystal Hu
in New York and Ambar Warrick in Bengaluru)