US stocks end with steep declines after hot inflation data

Wall Street equities took a beating Tuesday following disappointing US inflation data, ending the day with steep losses in the worst trading day in weeks.

The benchmark Dow Jones Industrial Average plunged nearly 1,300 points, a 3.9 per cent loss to finish the session at 31,104.97.

The broad-based S&P 500 dropped 4.3 per cent to 3,932.69, while the tech-rich Nasdaq Composite Index collapsed 5.2 per cent to 11,633.57.

Investors had been clinging to hopes that slowing price increases would allow the Fed to eventually pull back on its tough anti-inflation fight, but the data extinguished those hopes for now. While the annual increase in the consumer price index (CPI) slowed slightly in August to 8.3 per cent, inflation actually rose 0.1 per cent compared to July, the Labor Department said.