Carvana's (CVNA -3.56%) stock is sliding once again today, likely as investors continue their pessimistic view of the online car-selling retailer amid yesterday's worse-than-expected inflation report.
The company's shares retreated by 4.2% as of 11:18 a.m. ET.
This was the second day that investors were reacting strongly to the latest inflation data, which showed that the consumer price index increased by 0.1% in August and was up 8.3% over the past year.
Some economists had anticipated that the inflation rate would slow slightly in August, but the surprising increase caused a massive broader market sell-off yesterday, with the S&P 500 giving up 4%.
Yesterday, Carvana's stock closed the trading day down 13.8% and Carvana investors are extending yesterday's pessimism into today as they worry that stubbornly high inflation will weigh on consumer spending and hurt Carvana's sales.
Yesterday's inflation report was significant not just because it showed that prices are still climbing, but also because some investors had started thinking that perhaps the Federal Reserve would be able to back off its most extreme rate hikes.
That optimism flew out the window yesterday and now most investors are expecting another 75-basis-point hike at the Fed's meeting next week, with no end in sight for future hikes.
That's giving Carvana investors pause right now as they anticipate that further rate hikes will put additional pressure on the economy -- and consumer spending -- and hurt Carvana's ability to grow its business.