NEW YORK, April 12 (Xinhua) -- U.S. stocks slumped on Friday, as inflationary pressures dampened investors' sentiment.
The Dow Jones Industrial Average fell by 475.84 points, or 1.24 percent, to 37,983.24. The S&P 500 sank 75.65 points, or 1.46 percent, to 5,123.41. The Nasdaq Composite Index shed 267.10 points, or 1.62 percent, to 16,175.09.
All of the 11 primary S&P 500 sectors ended in red, with materials and technology leading the laggards by going down 1.77 percent and 1.64 percent, respectively. Utilities posted the weakest decline, down 0.74 percent.
Consumers are also growing worried about the persistent inflationary pressures. The consumer sentiment index for April came in at 77.9, below the Dow Jones consensus estimate of 79.9, according to the University of Michigan's Surveys of Consumers on Friday.
Several Fed officials stressed on Friday the need for patience before easing monetary policy amid persistent inflationary pressures.
"Policy is in a good place right now, and I need to be fully confident that inflation is on track to come down to 2 percent, which is our definition of price stability, before we would consider a rate cut," said Mary Daly, president of the Federal Reserve Bank of San Francisco.
Daily said there is "absolutely" no urgency to adjust the policy rate.
"We're getting further risk off sentiment heading into the weekend. You're seeing there's a flight to safety trade, with the dollar stronger, and we're seeing equities sell off," said Rob Haworth, U.S. Bank Wealth Management senior investment strategist.
The percentage of constituents in the S&P 500 outperforming the index has risen from very low levels, but still remains far from the highs of the past few years, such as during the broad-based rally in 2021, Barclays analyst Venu Krishna wrote in a Friday note.
"The U.S. equity rally is finally starting to broaden out, but we are starting from extraordinarily narrow levels and have a ways to go before establishing a truly broad base," Krishna said. "In the meantime, rates uncertainty is a growing risk, particularly as correlation tends to jump during selloffs."
The financials sector will draw attention from the market over the next two weeks as 50 percent of the S&P 500 companies are slated to release their first-quarter earnings.
Several big banks kicked off earnings season on Friday with JPMorgan Chase, Wells Fargo and Citigroup all reporting first-quarter results.
JPMorgan Chase's stock dived 6.47 percent following the release of its first-quarter results. The bank indicated that its net interest income, a crucial metric reflecting earnings from lending, might fall slightly below analysts' expectations for the year 2024. CEO Jamie Dimon also highlighted ongoing inflationary challenges affecting the economy.
Wells Fargo declined by 0.39 percent after revealing its quarterly figures, while Citigroup's stock fell 1.7 percent despite surpassing revenue expectations. Next week will bring numbers from Goldman Sachs, among others.
