About $340 billion in shareholder value was erased from the 30 companies that make up the Dow Jones Industrial Average after Wall Street endured its sharpest selloff in months, with investors reacting to the Federal Reserve's policy decision, rising Treasury yields and renewed geopolitical tensions in the Middle East.
The Dow Jones Industrial Average dropped 1,153.18 points , or 2.19% , to close at 51,594.14 , marking its biggest one-day fall since April 2025. The S&P 500 declined 1.52% to 7,316.15 , while the Nasdaq Composite slid 1.74% to 24,442.94 , leaving the technology-heavy index more than 10% below its record high.
The decline came after the Federal Reserve left interest rates unchanged, even as divisions within the central bank became more visible.
Yields Climb
The Federal Reserve voted 9-3 to keep the benchmark federal funds rate unchanged at 3.5% to 3.75% , with three policymakers backing an interest-rate increase because of persistent inflation concerns.
Fed Chair Kevin Warsh signalled the central bank remained prepared to respond if needed.
"I want to stress, of course, that decisions by this committee matter a great deal, and where necessary and appropriate, we will not hesitate to act," Warsh said during his post-meeting press conference.
Bond investors remained unconvinced. The yield on the 10-year U.S. Treasury climbed 7 basis points to above 4.67% , while the 30-year Treasury yield surged 10 basis points to above 5.2% , its highest level since 2007.
Oil Adds Pressure
Market sentiment weakened further after crude oil prices jumped following comments from President Donald Trump that the United States would hit Iran "hard" in response to attacks on U.S. troops in the Middle East.
U.S. West Texas Intermediate crude futures rose more than 6% to settle at $84.46 a barrel, adding to concerns that higher energy costs could reignite inflation pressures.
Asia Reacts
Asian markets traded mixed on Thursday as investors digested the Fed's policy decision alongside escalating tensions in the Middle East.
Japan's Nikkei 225 gained 1.74% and South Korea's Kospi advanced 1.50% , while Australia's ASX 200 slipped 0.50%
Investor attention remained on the Fed's split decision, while fresh U.S. strikes on targets in Iran kept energy markets on edge. Brent crude traded near $90 a barrel after jumping almost 8% in the previous session, its biggest one-day increase in more than two weeks. West Texas Intermediate remained above $84 a barrel.
The rebound in oil prices reinforced concerns that elevated energy costs could keep inflation under pressure, complicating the outlook for global central banks despite the Federal Reserve's decision to leave interest rates unchanged.
Essential Business Intelligence, Sharp Market Insights, Practical Personal Finance Advice, Daily Fuel, Gold and Silver Prices and Latest Stories — On NDTV Profit.
