Nasdaq slides on US inflation concerns, worst day since July

Equity markets retreated sharply as fresh economic data pointed to persistent inflationary pressures in the United States, prompting investors to reassess expectations for the Federal Reserve's monetary policy trajectory. The technology-heavy index's decline reflected broader market anxiety over the potential for the central bank to maintain higher rates for an extended period.

The sell-off underscores ongoing sensitivity among investors to inflation indicators, which continue to influence global financial sentiment. Stronger-than-anticipated price growth data has historically signalled the need for tighter monetary conditions, weighing on risk assets and particularly affecting growth-oriented sectors.

The Nasdaq's performance on Tuesday represented its most significant single-day drop since 23 July, signalling renewed volatility in equity markets as traders reassess their positioning around interest rate expectations. The decline follows a period of relative stability but highlights how economic data releases continue to drive market swings.

Regional markets, including Singapore's Straits Times Index, often track movements in major US indices and sentiment among global investors. The Nasdaq's weakness may influence trading patterns across Southeast Asian bourses as investors recalibrate their strategies in response to shifting US monetary policy expectations.