Wall Street tumbles as hot inflation data feeds worries about Fed rate hikes

Wall Street experienced a significant downturn on Wednesday following the release of hotter-than-expected inflation data. This news sparked concerns about additional interest rate hikes from the Federal Reserve, which had a negative impact on several key stocks. Companies such as Oracle, CoreWeave, and Nebius saw sharp declines in their share prices, suffering losses of 7.3 percent, 15 percent, and 10 percent respectively.

Dell and Hewlett Packard Enterprise also faced declines of 12 percent and 7.6 percent, respectively, after Barclays downgraded these AI server makers to "equal-weight" from "overweight."

The broader market sentiment was further dampened by the decline of the Philadelphia Semiconductor Index, which dropped nearly 4 percent. This decline marked the index's sixth consecutive day of losses and suggested it may be on track for its longest losing streak since May 2025. Data from the Labor Department's Bureau of Labor Statistics revealed that US consumer prices surged in September, driven by a spike in gasoline costs and a broader increase in price pressures beyond energy.

This inflationary pressure has led interest rate traders to consider a 37 percent chance that the Federal Reserve will raise rates again.