Dow Plunges Over 400 Points as PCE Data Sparks Market Volatility

The US stock market experienced a mixed session on Wednesday as the Dow Jones index plummeted over 400 points after the release of PCE data. The Federal Reserve's preferred inflation gauge showed a cooler-than-expected reading, with August data coming in below economists' forecasts.

According to the data, the Personal Consumption Expenditures (PCE) price index rose 0.3% month over month in August, while core PCE increased by 0.2%. These figures fell short of the consensus estimate of 0.4% and 0.3%, respectively.

The ADP report revealed that private payrolls rose by 90,000 in September, exceeding the anticipated growth of 68,000. However, most sectors on the S&P 500 closed with losses, particularly health care, consumer staples, and industrials stocks.

Notably, the CNN Business Fear & Greed Index remained in the 'Fear' zone at a reading of 31. This measure indicates that investor sentiment is still cautious despite some improvement in market conditions.