A troubling selloff of technology stocks has led to declines across the Dow Jones Industrial Average, the S&P 500 and the Nasdaq Composite in midday trading.
As of 1:30 p.m. ET, Wall Street was broadly in the red: The Dow tumbled 1.5%, or nearly 520 points, while the S&P and Nasdaq fell a respective 0.97%, or 40 points, and 0.13%, or 17 points. Investors have expressed growing concerns over inflation, with many appearing to shed Big Tech stocks, which led to the market’s downturn.
Shares of apparel and footwear companies also plummeted. Sportswear giants Nike Inc. and Under Armour Inc. dipped 0.037% and 1.74%, while sneaker retailer Foot Locker Inc. slumped 2.14%. Shoe chains Skechers USA Inc. and DSW parent Designer Brands Inc. were down 2.3% and 2%, as well as Crocs Inc. and Steven Madden Ltd., which dropped 0.71% and 1.56%. Department store Nordstrom Inc. decreased 5.01% and even big retail groups like Caleres Inc., Deckers Outdoor Corp., and Gap Inc. sank 0.97%, 1.88% and 2.47%, respectively.
In recent months, fears of significant price hikes have threaten to roll back the gains seen by the United States economy that was spurred by COVID-19 reopenings and vaccinations. Last month, the Bureau of Labor Statistics revealed that the consumer price index rose 2.6% for the month of March — the biggest year-over-year spike since August 2018. The increases have so far hit industries across the board, affecting vehicles, appliances, food and medical care, as well as some types of clothing, shoes and accessories.
What’s more, the next monthly consumer price index and producer price index from the agency will be released this week, and experts have predicted a strong jump in prices over last year’s pandemic-struck levels. According to some economists, gains in prices are expected to accelerate in the second quarter amid a surge in consumer demand coupled with inventory scarcity caused by ongoing port congestions and delays. A weakening U.S. dollar also threatens to drive an increase in consumer prices.
“Typically, as the dollar goes lower, commodity costs tend to go higher,” Gary Raines, chief economist at the Footwear Distributors and Retailers of America, told FN last month. “And that’s certainly been the case here, as the dollar has been down over the last year, and of course, all these commodity costs are up in the opposite fashion, as good economic theory says it should be.”