Dow Drops More Than 1,200 Points, Its Lowest Day Since June 2020

Stocks took a dive on Tuesday in the wake of news regarding inflation.

As of market close on Tuesday, the Dow Jones Industrial Average was down 1,276 points, or 3.9%, marking its worst day since June 2020.

The S&P 500 slid about 4.3% and the Nasdaq Composite was down more than 5%. Footwear stocks slid across the board as well, with Nike and Adidas down almost 6%, Caleres down 6.1%, and Foot Locker and Genesco down close to 5%.

The Bureau of Labor Statistics reported on Tuesday morning that prices in August increased 8.3% year over year, or 0.1% from July. Excluding volatile food and energy costs, prices rose 0.6% from July and 6.3% from the same month in 2021.

The inflation update, while marking a slowdown from the 8.5% year over year in July, caused a stock sell off on Tuesday morning, with the Dow, the S&P 500 and the Nasdaq Composite all down.

Online prices in August increased 0.4% year-over-year and 2.1% on a monthly basis, according to a Monday report from Adobe.

In a note to clients on Tuesday, Neil Saunders, managing director of consulting firm GlobalData, said that this new data “sends a helpful signal” to consumers, which is calming some concern about ever-increasing prices. However, Saunders added that the benefit is “somewhat marginal” given that the cost of living remains very elevated compared to a year ago.

Data from the Footwear Distributors and Retailers of America (FDRA) suggests that footwear prices are showing some signs of moderating as well. In August, footwear retail prices rose 5% over the past year, slower than the 7% posted in February, the second-highest increase in 33 years. Men’s footwear prices rose 4%, women’s climbed 4.9% and kids’ expanded 6.8%.

The Federal Reserve is expected to once again impose a 0.75 percentage point hike in interest rates when it meets later this month to help curb inflation.

imbox Sponsored

Customer Experience, Revenue Stream and Sustainability Come Wrapped in an IMBOX

Sustainable, footwear protection technology company, IMBOX Protection, is bringing its in-store service to the U.S. market for increased foot traffic and basket size with a new revenue stream.
Learn More

Access exclusive content