Stocks Sink to Lowest Since July as Fed Signals Further Tightening – US Market Wrap
US stocks fell to their lowest levels since July as investors positioned for further Federal Reserve tightening after policymakers delivered their first interest-rate increase in three years.
Equities reversed earlier gains, with most major S&P 500 sectors declining and the Dow Jones Industrial Average falling 1.2%. Short-dated Treasuries led losses, pushing two-year yields to their highest since 2024, while the dollar strengthened. Money markets priced roughly a 50% chance of another Fed rate hike in October.
The Federal Open Market Committee voted unanimously to raise the benchmark interest rate to a range of 3.75% to 4%. Updated projections showed policymakers expect one additional increase this year.
Fed Chair Kevin Warsh maintained a firm stance on inflation during his press conference, highlighting that a broad range of goods and services continue to show annualized price increases above 3% over both six- and 12-month periods.
