The US markets ended lower on Tuesday on concerns about acceleration in the rate of inflation and potential monetary policy tightening by the Federal Reserve. The Fed has attributed the increase in inflation to transitory factors, although street has suggested the central bank will still begin considering tapering its asset purchases in the coming months. Adding to the inflation concerns, the Labor Department released a report showing the number of job openings reached a series high of 8.1 million on the last business day of March. The data led to worries that employers will have to raise wages to entice workers, which could carry over into higher inflation.
Besides, Housing stocks turned in some of the worst performances on the day, with the Philadelphia Housing Sector Index plunging by 3.2 percent after ending the previous session at its best closing level since a two-for-one split in early 2006. Substantial weakness was also visible among oil stocks, as reflected by the 2.4 percent slump by the NYSE Arca Oil Index. The index extended the pullback seen after it reached a one-year intraday high in early trading on Monday. The weakness among oil stocks came even though the price of crude oil turned higher over the course of the session after an early drop.
Dow Jones Industrial Average fell 473.66 points or 1.36 percent to 34,269.16, Nasdaq dropped 12.43 points or 0.09 percent to 13,389.43 and S&P 500 was down by 36.33 points or 0.87 percent to 4,152.1.