The major stock market indexes ended a choppy trading session on Friday, as Dow Jones was down 2.7%, while the S&P 500 and Nasdaq lost 2.9% and 3.5%, respectively. The decline came after the release of higher-than-expected U.S. inflation data. The Bureau of Labor Statistics reported that the U.S. consumer price index rose 8.6% last month, the fastest increase since December 1981. This has stoked worries on Wall Street that inflation has become more deep-rooted, which could potentially push Fed officials to take more aggressive actions.
The Federal Reserve is widely expected to raise interest rates by a half percentage point this week and again next month. Nevertheless, the current market volatility has led to many quality stocks trading at attractive valuations. And since value stocks typically perform well in a high-inflationary environment, it could be an opportune time to scoop up such stocks.
