Dow Dives 1.1K Points After Fed Decision

Oil prices got back to jumping on Wednesday, while sinking technology stocks dragged Wall Street lower amid uncertainty about what the Federal Reserve will do to get high inflation under control.

• The S&P 500 fell 112.63 points, or 1.5%, to 7,316.15 after briefly erasing all of an earlier drop of 1.2%.
• The Dow Jones Industrial Average fell 1,153.18 points, or 2.2%, to 51,594.14.
• The Nasdaq composite fell 433.97 points, or 1.7%, to 24,442.94.

More drops for recent AI winners including Nvidia, Micron Technology, and AMD weighed on the stock market. In oil trading, the price of Brent crude leaped 7.3% to settle above $88 per barrel after fighting resumed in the war with Iran and raised worries about the global flow of oil, the AP reports.

Brent oil's price had swung as low as $72 early this month and as high as $102 last week.The swings have raised worries that inflation will reaccelerate, just when it had begun to slow more than economists expected. That had traders coming into the day betting on a roughly 34% probability that the Fed would raise its main interest rate in the afternoon, according to data from CME Group. Fed officials instead voted to keep the federal funds rate steady, though three members of the policymaking committee did want to raise rates.

• Fed Chair Kevin Warsh implied the bond market may already be doing some of the work to restrain inflation, pointing to how yields have climbed since the central bank's last meeting six weeks ago.
• Warsh reiterated his commitment to get inflation back to 2% following years of faster-than-hoped increases in prices, but he also stuck to his plan of giving financial markets fewer clues about what the Fed may do with interest rates in the near future. With less guidance from the Fed, financial markets may be set for more volatile trading amid the uncertainty.

On Wall Street, Nvidia was the heaviest weight on the S&P 500 after the chip company fell 3.6%. KLA Corp., whose products and services help make semiconductors, lost 10.8% even though it reported stronger-than-forecast profit and revenue for the latest quarter. Expectations were high after its stock surged nearly 150% in this year's first six months. Micron fell 9.9%.

On Tuesday, gains for stocks outside AI helped offset weakness for tech companies. Analysts have been saying such a rotation in the market from AI to less-loved areas could be healthy, but the majority of US stocks fell with tech on Wednesday. Hims & Hers Health tumbled 14.7%, for example, after the Federal Trade Commission, Utah, and California alleged it shared consumers' sensitive health information about medical conditions with third-party advertising platforms despite claiming its services maintain consumers' privacy. Hims & Hers said the lawsuit is contorting "the law to try to manufacture claims," which it called baseless.