U.S. Markets Fall amid Inflation Worries

Higher inflation expectations stoke fears of aggressive Fed causing a recession.

stock chart pointing down
(Image credit: Getty Images)

U.S. stocks dropped on Friday as worsening inflation expectations kept intact worries that the Federal Reserve's aggressive rate hike path could lead to an economic recession, while investors digested the early stages of earnings season.

In what has been a volatile week for stocks, equities opened higher before reversing course after data from he University of Michigan showed consumer sentiment improved in October but inflation expectations worsened as gas prices moved higher. Retail sales data also indicated resilience among consumers.

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