U.S. stocks posted their biggest weekly percentage declines since January and ended sharply lower on the day Friday as a steeper-than-expected rise in U.S. consumer prices in May fueled fears of more aggressive interest rate hikes by the Federal Reserve.
The consumer price index (CPI) increased 1.0% last month after gaining 0.3% in April, compared to expectations for a rise of 0.7%, according to the Labor Department.
Year on year, CPI surged 8.6%, its biggest gain since 1981 and following an 8.3 percent jump in May.
Two-year Treasury yields spiked to 3.057%, the highest since June 2008; benchmark 10-year yields reached 3.178%, the highest since May 9.
Tech and growth stocks, whose valuations rely heavily on future cash flows, led the decline.
The S&P 500 posted one new 52-week high and 44 new lows; the Nasdaq recorded 17 new highs and 326 new lows.
The major indexes registered their biggest weekly percentage drops since the week ended Jan. 21.
The inflation report was published ahead of an anticipated second 50 basis points rate hike from the Fed on Wednesday.