The tech-heavy Nasdaq falls 3.3 percent, its worst decline since February.
Stocks slumped and bond yields rose Wednesday as Wall Street interpreted the minutes from the Federal Reserve’s recent meeting of policymakers as a sign the central bank is poised to move faster to raise interest rates this year as it battles inflation. The S&P 500 fell 1.9 percent, its biggest drop since September, as technology companies led a broad market slide. The tech-heavy Nasdaq composite fell 3.3 percent, its worst decline since February. The Dow Jones Industrial Average fell 1.1 percent, pulling back from the record high it set a day earlier. Bond yields moved higher after the minutes from the Fed meeting came out. The yield on the 10-year Treasury note, a benchmark for setting rates on mortgages and many other kinds of loans, rose to 1.70 percent soon after the minutes were released, from 1.68 percent just before. It hasn’t been at 1.70 percent since April. The Fed minutes showed that policymakers at their meeting last month expressed concerns that inflation, which has surged to four-decade highs, was spreading into more areas of the economy and would last longer than they previously expected. The Fed officials also concluded that the U.S. job market was nearly at levels healthy enough that the Fed’s low-interest rate policies were no longer needed. For both those reasons, Fed Chair Jerome Powell said after the Dec.14-15 meeting that the central bank was accelerating the reduction of its ultra-low interest rate policies. Even so, Wall Street appeared to read the minutes as a sign that the central bank will be perhaps more aggressive about rolling back the economic stimulus policies it put in place after the pandemic, which could mean a faster road to higher interest rates.
