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U.S. Stocks Close Wednesday with Losses
(MENAFN) U.S. stocks tumbled sharply on Wednesday after the Federal Reserve opted to hold interest rates steady, deepening investor worry that the central bank is losing ground in its battle against inflation.
The Dow Jones Industrial Average cratered 1,153.18 points, or 2.19%, closing at 51,594.14 — its steepest single-day drop since April 2025.
The S&P 500 slid 1.52% to settle at 7,316.15, while the Nasdaq Composite shed 1.74% to close at 24,442.94.
The VIX, widely known as Wall Street's "fear index," spiked 13.45% to 20.66 points, its highest reading in roughly two months.
The Federal Reserve kept its federal funds target range unchanged at 3.5%-3.75%, though three policymakers dissented in favor of raising rates — underscoring a growing rift within the central bank over how aggressively to confront persistent inflationary pressure.
Bonds sold off sharply in the aftermath, with the yield on the benchmark 10-year U.S. Treasury note climbing seven basis points to top 4.67%.
The 30-year Treasury yield rose roughly 10 basis points to surpass 5.2%, its highest level since 2007, as investors sought greater compensation for the risk of prolonged inflation.
Fed Chair Kevin Warsh said the central bank would not hesitate to act when necessary, but his comments did little to quiet fears that current policy remains too loose to tame prices.
Inflation anxieties were further stoked by a sharp rally in oil prices after President Donald Trump said Washington would hit Iran “hard” in retaliation for attacks on American forces in the Middle East.
U.S. benchmark West Texas Intermediate crude surged more than 6% to close at $84.46 per barrel, stirring concern that rising energy costs could add fresh momentum to broader price pressures.
Semiconductor stocks deepened their recent slide amid growing skepticism over returns on massive AI infrastructure spending and mounting competitive pressure from China. Micron Technology and KLA each sank about 10%, while Advanced Micro Devices lost 5.5%.
European Markets Mostly Retreat
European exchanges largely closed lower Wednesday as investors weighed escalating U.S.-Iran tensions alongside the shifting monetary policy outlook.
The pan-European Stoxx Europe 600 slipped 0.29% to finish at 645.01 points.
France's CAC 40 fell 0.6% to 8,408.27, Germany's DAX 40 edged down a marginal 0.01% to 25,460.48, and Italy's FTSE MIB 30 declined 0.49% to 51,443.11.
Britain's FTSE 100 was the outlier, gaining 0.34% to close at 10,908.41.
The Dow Jones Industrial Average cratered 1,153.18 points, or 2.19%, closing at 51,594.14 — its steepest single-day drop since April 2025.
The S&P 500 slid 1.52% to settle at 7,316.15, while the Nasdaq Composite shed 1.74% to close at 24,442.94.
The VIX, widely known as Wall Street's "fear index," spiked 13.45% to 20.66 points, its highest reading in roughly two months.
The Federal Reserve kept its federal funds target range unchanged at 3.5%-3.75%, though three policymakers dissented in favor of raising rates — underscoring a growing rift within the central bank over how aggressively to confront persistent inflationary pressure.
Bonds sold off sharply in the aftermath, with the yield on the benchmark 10-year U.S. Treasury note climbing seven basis points to top 4.67%.
The 30-year Treasury yield rose roughly 10 basis points to surpass 5.2%, its highest level since 2007, as investors sought greater compensation for the risk of prolonged inflation.
Fed Chair Kevin Warsh said the central bank would not hesitate to act when necessary, but his comments did little to quiet fears that current policy remains too loose to tame prices.
Inflation anxieties were further stoked by a sharp rally in oil prices after President Donald Trump said Washington would hit Iran “hard” in retaliation for attacks on American forces in the Middle East.
U.S. benchmark West Texas Intermediate crude surged more than 6% to close at $84.46 per barrel, stirring concern that rising energy costs could add fresh momentum to broader price pressures.
Semiconductor stocks deepened their recent slide amid growing skepticism over returns on massive AI infrastructure spending and mounting competitive pressure from China. Micron Technology and KLA each sank about 10%, while Advanced Micro Devices lost 5.5%.
European Markets Mostly Retreat
European exchanges largely closed lower Wednesday as investors weighed escalating U.S.-Iran tensions alongside the shifting monetary policy outlook.
The pan-European Stoxx Europe 600 slipped 0.29% to finish at 645.01 points.
France's CAC 40 fell 0.6% to 8,408.27, Germany's DAX 40 edged down a marginal 0.01% to 25,460.48, and Italy's FTSE MIB 30 declined 0.49% to 51,443.11.
Britain's FTSE 100 was the outlier, gaining 0.34% to close at 10,908.41.
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