US stocks fall as disappointing inflation figures trigger more rate hike fear

By Ovunc Kutlu

ISTANBUL (AA) - US stocks fell Tuesday at opening as disappointing inflation figures triggered fear that the Federal Reserve would not pause its rate hike any time soon.

Annual consumer inflation came in at 6.4% in January, slightly easing from 6.5% in December, but coming in higher than the market estimate of a 6.2% increase, according to the Labor Department figures released earlier.

On a monthly basis, consumer prices in January rose 0.5% from the previous month, while the figure for December was revised to a 0.1% gain from a decline of the same magnitude.

Disappointing inflation data have triggered fear among investors that the Fed would not soon pull its foot off the throttle in interest rate increases during its fight against inflation.

The Dow Jones, the S&P 500 and the Nasdaq all were in the red shortly after opening bell at 9.30 a.m. EDT, but the indices later managed to climb back into positive territory at 9.57 a.m. EDT.

The VIX volatility index, also known as the fear index, plummeted 7.6% to 18.80 at 10.04 a.m. EDT (1505GMT).

The 10-year US Treasury yield, meanwhile, rose 0.34% to 3.756%.

The dollar index was down 0.23% to 103.11, while the euro added 0.34% to $1.0756 against the greenback.

Precious metals were mixed with gold rising 0.55% to $1,863 an ounce, but silver shedding 0.4% to $21.92.

Crude oil prices were down more than 1% with global benchmark Brent crude at $85.69 per barrel and US benchmark West Texas Intermediate crude at $79.22 a barrel.