Dow sheds 290 points, S&P 500 closes lower despite cooler-than-expected inflation reading
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U.S. stock indexes closed lower Tuesday, giving up gains earlier in the session after a better-than-feared inflation reading and falling back into their September doldrums. The Dow Jones Industrial Average shed 292.06 points, or 0.8%, to 34,577.57. The S&P 500 dipped nearly 0.6% to 4,443.05 and the Nasdaq Composite ticked about 0.5% lower to 15,037.76. Stocks popped at the open after the August consumer price index, while still showing a significant jump in inflation, came in less than expected. However, the stock averages turned lower roughly half an hour into trading. Shares linked to the economic recovery dropped. Bank of America lost 2.6%. General Electric took industrial shares into the red, closing 3.9% lower.

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"What we need to see to be fundamentally markets supportive is a continued easing in the inflation piece without deterioration in the economic outlook," said Liz Ann Sonders, Charles Schwab chief investment strategist. Apple shares closed nearly 1% lower after the company unveiled the new iPhone 13 at its annual fall product event, its stock movement in line with historical patterns. Meanwhile, investors crowded into some of their favorite tech bastions with Microsoft ending the day 0.9% higher. Stocks have been under pressure since August's jobs report, released by the Labor Department on Sept. 3, missed expectations. "The next couple of weeks, economic data points become even more important to see whether it confirms the the weakness that we saw on the August jobs report or starts to suggest that maybe we're seeing an improvement," Sonders said.