PARIS (Reuters) – The New York Stock Exchange opened sharply lower on Wednesday, after the publication of an American CPI inflation indicator higher than expected in March.

In early trading, the Dow Jones index lost 365.81 points, or 0.94% to 38,506.72 points and the broader Standard & Poor’s 500 fell 1.08% to 5,153.70 points. The Nasdaq Composite lost 1.24% or -202.33 points, to 16,104.304.

CPI inflation in March increased by 0.4% over one month, against 0.3% expected by the consensus, while underlying inflation advanced by 3.8% over one year, against 3.7 % predicted by consensus.

Energy and services contributed to the rebound in price dynamics.

“This slight but significant rise in inflation figures raises questions about the Federal Reserve’s ability to reduce rates in June,” notes Florian Ielpo, head of macroeconomic research at Lombard Odier IM.

Money markets are now betting on fewer than two rate cuts in 2024, with a first cut decided in September.

The minutes of the Fed’s latest monetary policy meeting, expected at 6:00 p.m. GMT, could qualify this positioning.

In terms of values, TSMC gained 0.41% after announcing on Wednesday a 16.5% increase in its turnover in the first quarter, higher than consensus, thanks to demand linked to artificial intelligence.

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(Written by Corentin Chappron, edited by Kate Entringer)

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