US Stocks Plunge as Wall Street Readies for Next Week's FOMC

New York (Sept 16) Stocks fell on Friday as Wall Street eagerly awaited next week's meeting of the Federal Reserve.

The S&P 500 was down 0.46%, the Dow Jones Industrial Average fell 0.5%, and the Nasdaq slid 0.2%.

Investors renewed their confidence that the Fed likely won't raise interest rates until the end of the year, at the earliest, following a series of weak data points on Thursday. Retail sales, producer prices and industrial production in August each came in weaker than expected, reducing the chances the Fed will feel confident enough in the state of the U.S. economy to raise rates next week.

The chances of a rate hike in September sit at 12%, according to CME Group fed funds futures. Most analysts are betting on a December hike.

Members of the Federal Open Market Committee will convene on Tuesday morning for a two-day meeting, culminating in an announcement on Wednesday afternoon. Fed Chair Janet Yellen will also hold a press conference on Wednesday.

Consumer prices rose more than expected in August, a sign for the Federal Reserve that inflation trends are moving in the right direction. The Consumer Price Index last month increased 0.2%, according to the Bureau of Labor Statistics, higher than an expected 0.1% increase. Excluding food and energy, core prices rose 0.3%. Consumer prices have climbed 1.1% over the past 12 months, or 2.3% excluding food and energy.

Crude oil tumbled again on Friday ahead of weekly data on the number of active oil rigs in the U.S. to be released Friday afternoon. Oil has been under pressure, particularly this week, with little relief to U.S. stockpiles and fading hopes of a production freeze agreement when Organization of Petroleum Exporting Countries informally meet later this month.

Source: The Street