​Stocks down 1 percent on heightened expectations of Fed hikes – CBS News

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Last Updated May 17, 2016 2:57 PM EDT

NEW YORK – U.S. stocks declined sharply Tuesday after economic reports on inflation and housing pointed to an economy that could be able to withstand further interest rates hikes by the Federal Reserve.

The Dow Jones industrial average fell 201 points, or 1.1 percent, to 17,512 at 2:57 p.m. ET. The S&P 500 index dropped 22 points, or 1.1 percent, to 2,045. The Nasdaq composite index slid 62 points, or 1.3 percent, to 4,713.

Home Depot shares declined after executives at the home-improvement retailer said same-store sales gains narrowed as the first-quarter continued.

A report out Tuesday had the cost of living rising in April by the most in three years, a sign that inflation could be gaining momentum. Another report had residential starts increasing 6.6 percent to 1.17 million from 1.1 million in March.

Minutes from the Fed’s April meeting come Wednesday, with the market pricing in only a slight chance the central bank will hikes rates in June.