Dow Dips More Than 200 Points Following Inflation Report, Megacap Tech Stocks Edge Lower: Greed Index In 'Fear' Zone

The CNN Money Fear and Greed index showed a decline in the overall market sentiment, with the index in the “Fear” zone on Wednesday.

U.S. stocks settled mostly lower on Wednesday, with the Dow Jones index falling more than 200 points during the session following the release of inflation data.

The headline CPI rose 3% year over year in January, surpassing both December’s 2.9% reading and economist forecasts of 2.9%. On a monthly basis, inflation increased 0.5%, outpacing expectations of 0.3% and accelerating from December’s 0.4% gain. This marked the fastest monthly inflation rate since August 2023.

Shares of some megacap tech stocks, including Amazon.com, Inc. AMZN and Alphabet Inc. GOOG GOOGL settled lower on Wednesday. However, Tesla Inc. TSLA shares jumped more than 2% during the session after the electric vehicle maker tumbled 6.3% on Tuesday, reaching oversold levels and extending its losing streak to five consecutive sessions.

CVS Health Corp CVS shares surged around 15% on Wednesday after the company reported better-than-expected results for its fourth quarter.

Most sectors on the S&P 500 closed on a negative note, with materials, energy, and real estate stocks recording losses on Wednesday. However, consumer staples and communication services stocks bucked the overall market trend, closing the session higher.

The Dow Jones closed lower by around 225 points to 44,368.56 on Wednesday. The S&P 500 fell 0.27% to 6,051.97, while the Nasdaq Composite rose 0.03% at 19,649.95 during Wednesday's session.

Investors are awaiting earnings results from Deere & Company DE, GE HealthCare Technologies Inc. GEHC, and Coinbase Global, Inc. COIN today.

What Is CNN Business Fear & Greed Index?

At a current reading of 43.8, the index remained in the “Fear” zone on Wednesday, versus a prior reading of 44.

The Fear & Greed Index is a measure of the current market sentiment. It is based on the premise that higher fear exerts pressure on stock prices, while higher greed has the opposite effect. The index is calculated based on seven equal-weighted indicators. The index ranges from 0 to 100, where 0 represents maximum fear and 100 signals maximum greediness.

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