U.S. stocks saw losses sharpen late-morning Tuesday as Federal Reserve Chairman Jerome Powell suggested that a more rapid tightening of financial conditions may be warranted as the omicron variant of the coronavirus that causes COVID-19 complicates the economic recovery and potentially intensifies supply-chain bottlenecks. The Dow Jones Industrial Average /zigman2/quotes/210598065/realtime DJIA -1.30% was down 570 points, or 1.6%, at 34,567, the S&P 500 index /zigman2/quotes/210599714/realtime SPX -1.89% was trading 1.6% lower at 4,581, while the Nasdaq Composite Index /zigman2/quotes/210598365/realtime COMP -2.72% was trading 1.7% lower at 15,520. During Tuesday's testimony in front of the Senate Banking Committee as a part of the CARES act, Powell said that risk of persistent inflation has risen and said that the central bank may need to speed up its reduction of asset-purchases, which could set the table for faster interest-rate increases by the Fed, potentially bearish for risky assets in the short term.
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