Dow falls 240 points after CPI data shows inflation is running at a 30-year high

Dow falls 240 points after CPI data shows inflation is running at a 30-year high

US stocks saw their worst drop for the month Wednesday after hotter than expected inflation data showed that prices are rising at the fastest rate in decades. The Dow Jones Industrial Average ended lower by 240 points. The Nasdaq composite and the benchmark S&P 500 also closed lower. The yield on 10-year Treasury rose to 1.551% Wednesday compared to Tuesday's 1.431%. Bond yields and prices move in opposite directions. The Consumer Price Index - a key measure of nationwide inflation - gained 6.2% on a year-over-year basis, the fastest rate of annual inflation since 1990. It also showed price growth picking up from September's one-year jump. CPI , higher than the 0.6% estimated by economists surveyed by Bloomberg. The reading marks an acceleration from the 0.4% gain seen in September and the largest one-month jump since 2008. Rising inflationary pressures are dragging both equities and bonds, and may prompt the Federal Reserve to hike interest rates earlier than anticipated, according to Lon Erickson, portfolio manager at Thornburg Investment Management. " Treasuries and global developed sovereign yields have moved higher as the market prices in Fed taper and future Fed Funds Rate hikes," Erickson said in a note Wednesday. Investors believe