Stock market today: Inflation data spooks markets as Dow closes down 500 points

US stocks tumbled on Tuesday, falling from recent highs as investors digested a hotter-than-expected January inflation report that showed prices cooling slower than forecasts anticipated. All three major indices closed down more than 1% on the heels of the report. The Dow Jones Industrial Average (^DJI) fell 1.4%, or around 500 points, while the S&P 500 (^GSPC) saw a similar drop, after the benchmark faltered Monday in its bid to keep its historic rally above 5,000 going. The tech-heavy Nasdaq Composite (^IXIC) led the day’s sharp declines, closing down 1.8%. When removing the volatile food and energy categories, Tuesday’s Consumer Price Index (CPI) release showed “core” prices increased 0.4% in January, their largest monthly gain since April 2023. On a headline basis, prices increased 3.1%, above economist estimates but a deceleration from a 3.4% annual gain in December. In other markets, the price of bitcoin (BTC-USD) hovered below $50,000 after the leading cryptocurrency hit the closely watched level for the first time since 2021, seen as a remarkable comeback.