UPDATE - US stocks retreat after Fed's inflation indicator revised up

VIX volatility index jumps 15.8% to 23.24

UPDATES DECK, STORY WITH NEW FIGURES THROUGHOUT

By Ovunc Kutlu

ISTANBUL (AA) - US stocks opened lower Thursday, giving up some of the gains in the previous day's rally, as the Federal Reserve's preferred inflation indicator was higher than expectations.

The blue-chip Dow Jones industrial average fell 330 points, or 1%, to 33,046 at 9.50 a.m. EDT. The S&P 500 lost 50 points, or 1.3%, to 3,828.

The tech-heavy Nasdaq fell 196 points, or 1.8%, to 10,514.

The indices rallied Thursday to gain between 1.5% - 1.6%.

In mid-day trading, the stocks extended their losses.

The Dow plummeted 636 points, or 1.9%, to 32,648 at 12.30 p.m. EDT. The S&P 500 fell further by 94 points, or 2.4%, to 3,784 and the Nasdaq did a nosedive 353 points, or 3.3% to 10,357.

Among tech stocks, electric carmaker Tesla was down a massive 9.6%, followed by video game and electronics retailer GameStop with an 8.2% loss and e-commerce firm Etsy for a 7.1% decline.

The Fed's most reliable inflation indicator, core personal consumption expenditures (PCE) price index, increased 4.7% annually in the third quarter, the final reading of the Commerce Department said earlier.

While the index came in higher than market expectations of 4.6%, it is an upward revision of 0.1 percentage point from the second reading.

The increase in the figure caused fears to return that the US central bank could continue aggressively rate hikes next year to fight inflation.

The VIX volatility index, also known as the fear index, jumped 15.8% to 23.24. The 10-year US Treasury yield fell 0.15% to 3.678% at 12.30 p.m. EDT.

The dollar index rose 0.3% to 104.50, while the euro was down 0.2% to $1.0583 against the greenback.

Precious metals also extended their losses. Gold fell 1.1% to $1,794 per ounce and silver dove 1.8% to $23.54.

Crude oil prices gave up earlier gains and changed course. Global benchmark Brent crude was down 0.9% to $81.45 per barrel. US benchmark West Texas Intermediate crude was around $77.75 -- down 0.7%.

Kaynak:

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