Bloomberg - Evening Briefing - Markets crater

Markets tumbled on Tuesday after the latest inflation reading dashed hopes that surging prices had peaked across the US economy. The S&P 500 dropped 4.3% (its worst day since June 2020) and the tech-heavy Nasdaq fell 5%. Many investors now expect a full 100-basis point rate hike by the Federal Reserve during its policy meeting next week to rein in inflation. The consumer price index advanced in August—after no change in July—pointing to a stubbornly high cost of living for Americans despite recent relief at the gas pump. The Fed has a much harder task on its hands than previously thought: If Americans won’t dial back spending further, odds favor the central bank becoming that much more aggressive and potentially sending the economy into a downturn. Here’s your markets wrap. —Margaret Sutherlin

Bloomberg is tracking the coronavirus pandemic and the progress of global vaccination efforts.

Ukrainian forces have recaptured more than 6,000 square kilometers (2,300 square miles) in the east and south of the country so far this month in its counteroffensive against Russia, Ukrainian President Volodymyr Zelenskiy said. Western officials maintain it’s too early to say whether this is a turning point in the war, but the push was devised by US, UK and Ukrainian leaders. Ukrainian troops meanwhile are pressuring retreating Russian forces and recaptured Vovchansk—a town just 3 km from Russia seized on the first day of the war. Follow our guide to see how the war in Ukraine has changed over six months. 

A man stands outside a partially destroyed building following a missile strike in Kharkiv, Ukraine. Photographer: Sergey Bobok/AFP

While Russia retreats on the ground, Vladimir Putin is using a summit this week with leaders of China, India, Turkey and Iran to counter his diplomatic isolation. It’s not just a key moment for Putin but also for China’s Xi Jinping, who for the first time in 1,000 days is traveling outside his country. 

Twitter’s security lapses were so grave they threatened national security and far outpaced US regulators’ ability to police them, the company’s former head of security-turned-whistleblower told senators Tuesday. The whistleblower’s allegations come as Twitter prepares to go to court to force Tesla CEO Elon Musk to complete a $44 billion deal to buy the company. Meanwhile Twitter shareholders approved Musk’s abandoned bid. 

Peiter Zatko Photographer: Eric Lee/Bloomberg

The US may begin refilling its emergency oil reserve when crude prices dip below $80 a barrel. Biden administration officials are weighing the timing, with an eye toward protecting US oil-production growth and preventing crude prices from plummeting.

The firings are coming for white-collar workers. Service jobs bore the brunt of early pandemic layoffs, but employees in business services, tech, banking and real estate, where staffing numbers are far above pre-Covid levels, are most vulnerable to cuts as the economy slows. 

The US fell to 18th in a global retirement ranking. Inflation, market volatility and an aging population make 2022 “one of the worst years to retire.”  

“The Merge” is coming. For non-crypto fanatics, that means Ethereum (the crypto network that runs Ether, the world’s second-most-valuable digital currency) is getting a makeover with a long-anticipated software change. The goal? It’s expected to lower Ethereum’s energy use by 99%.

• America’s poverty rate rose in 2021.
• Ex-Disney CEO Bob Iger is joining Josh Kushner’s venture capital firm. 
• Expect Covid-zero to carry on in China, Goldman analysts predict.
• What to know about a potential rail strike in the US. 
• The Philippines’ new president is putting new pressure on China.
• Ferrari just unveiled an SUV with a plea: don’t call it an SUV.
• Bloomberg Podcast In Trust: The Drummond family legacy started here.

Where do all the millionaires live? A new report showed half of the top 10 cities with the most millionaires are in the US. Saudi Arabia’s capital of Riyadh, and Sharjah, the United Arab Emirates’s third most populous city, are the cities with the fastest growing millionaire population so far this year. So which city came in at No. 1?

Photographer: David Paul Morris/Bloomberg

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