Wall St: Dow falls nearly 600 points on inflation angst as oil soars

Energy stocks outperform broader market; big banks, travel shares lead declines

Megacap growth names and financial stocks dragged Wall Street's main indexes more than 1% lower on Monday, as the prospect of a ban on oil imports from Russia sent crude prices soaring and fueled concerns about spiraling inflation.

Nine of the 11 major S&P sectors declined, with financial , communication services and consumer discretionary sliding over 2% each.

Bank of America slumped 5.5%, dragging the S&P 500 banks index down 3.4%. Payment service providers Visa , American Express Mastercard lost nearly 4% after they suspended operations in Russia.

Microsoft Corp, Amazon.com Inc and Nvidia Corp fell between 2% and 3.3% to weigh the most on the S&P 500 and the Nasdaq indexes.

Energy shares rose 0.6% in volatile trading as Brent crude scaled $139 a barrel in the session, its highest since 2008, after countries from Japan to the United States discussed banning Russian oil imports in response to the country's invasion of Ukraine.

"If rising labor costs was the big issue last year, coming into this year it appears that now companies are getting hit not just on their labor but also on input (costs)," said Robert Cantwell, portfolio manager at Upholdings.

"Long term, we love U.S. equities and, in short term, we're steadily buying volatility ... it's much more attractive to enter the stock market today than it was 12 months ago." The CBOE volatility index, also known as Wall Street's fear gauge, rose for the second straight day and was last trading at 33.70 points.

Russia, which calls the campaign it launched on Feb. 24 a "special military operation", has told Ukraine it is ready to halt military operations "in a moment" if Kyiv meets a list of conditions, the Kremlin spokesman said.

At 12:10 p.m. ET, the Dow Jones Industrial Average was down 593.74 points, or 1.77%, at 33,021.06, the S&P 500 was down 85.54 points, or 1.98%, at 4,243.33, and the Nasdaq Composite was down 278.28 points, or 2.09%, at 13,035.16.

Cruise operator Royal Caribbean Cruises Ltd and carrier United Airlines Holdings Inc plummeted 6.8% and 9%, respectively, to lead losses among travel companies, as the jump in oil prices threatened to again disrupt a nascent recovery.

Defense stocks L3Harris Technologies Inc, Northrop Grumman Corp and Lockheed Martin Corp gained between 3.8% and 4%.

Investors are waiting for U.S. consumer prices report on Thursday, with the Federal Reserve widely expected to hike rates later this month to combat surging inflation.

Fed Chair Jerome Powell last week backed a 25-basis-point rate hike at the central bank's March 15-16 policy meeting and would be "prepared to move more aggressively" later if inflation does not abate as fast as expected.

Traders now see a 99% probability of a 25 basis point rate hike by the Fed at its March meeting, while a 1% chance of no change in rates.

Declining issues outnumbered advancers for a 3.05-to-1 ratio on the NYSE and for a 2.19-to-1 ratio on the Nasdaq.

The S&P index recorded 50 new 52-week highs and 53 new lows, while the Nasdaq recorded 53 new highs and 418 new lows.