The Dow Jones fell 1.26%, the Nasdaq index fell 1.78% and the broader S&P 500 index fell 1.38%.

The producer price index (PPI) rose 0.7% in January over one month, the highest level since June and significantly above economists' forecasts (+0.4%).

"The Fed (US central bank) will see this figure as confirmation that inflation will remain stubbornly high this year," said Bill Adams of Comerica Bank.

After anticipating a possible peak for the Fed rate in March, then in June, operators favor continued tightening until July with at least three increases of a quarter of a percentage point.

"The Fed is going to have to go harder and that's what's pushing the markets down," said Angelo Kourkafas of Edward Jones.

The bond market also reacted, with the yield on US government bonds climbing to 3.86%, its highest level since the start of the year.

The 3-month rate, which better reflects expectations in terms of short-term monetary policy, reached 4.79% for the first time in more than 15 years.

A growing number of investors believe that the correction that has taken place on the bond market in recent weeks will also have to intervene, sooner or later, on the equity market.

"We will probably have a reflux, as the optimism (observed since the beginning of the year) moderates", warns Angelo Kourkafas.

The New York square was also scalded by the fall in manufacturing activity in the Philadelphia region, which fell to -24.3 points in February against -8.9 points in January.

On the side, Tesla slipped at the end of the session (-5.69%) after the announcement of the recall of more than 360,000 vehicles of the brand, which will have to go through an update of the assistance software. FSD driving, after a dispatcher reported malfunctions that could cause accidents.

Behind the electric vehicle manufacturer, the entire technology sector hiccupped, against a backdrop of rate hikes.

Amazon (-2.98%), Microsoft (-2.66%) or Meta (-2.66%) all slipped.

The IT infrastructure specialist Cisco was one of the few to pull through (+5.24%), thanks to higher-than-expected results and an increase in its forecast for its entire staggered fiscal year (August to July ) 2023.

Lockheed Martin (-1.93%) and Raytheon (-0.48%) fell, after the decision of the Chinese authorities to place the two aeronautics and defense groups on the list of "unreliable entities", which prohibits them from trading with China.

The Manchester United club (+9.73%), listed in New York, took off thanks to press reports that Qatari investors have made an offer, which could be formalized on Friday, to buy this institution of English football.

The e-commerce platform Shopify tumbled (-15.88%), penalized for forecasts deemed disappointing for the current quarter, which take into account the deceleration of e-commerce in the wake of the pandemic and consumer spending due to macroeconomic uncertainty.

The Paramount media group fell (-4.24%) after the publication of results below expectations, marked by a drop in advertising revenue on traditional Paramount channels, as well as a decline in licensed program sales.

The plastic clog specialist Crocs jumped (+4.40%), supported by better-than-expected results for the fourth quarter, driven in particular by the leisure shoe brand Heydude, acquired in early 2022.

© 2023 AFP