US stocks slide as Fed holds rates, hints at hikes
US stock markets slid on Wednesday after the Federal Reserve kept interest rates steady but made it clear they might raise them later this year.
The S&P 500 fell 1.19% and the Nasdaq dropped 1.32%, as investors reacted to new Fed Chair Kevin Warsh's focus on fighting inflation and the possibility of higher borrowing costs ahead.
Fed officials expect 2026 hike
The Fed didn't cut rates like some hoped; instead, nine officials now expect at least one hike by 2026, and any talk of rate cuts is off the table for now.
Warsh skipped giving a detailed forecast but doubled down on keeping prices stable, saying inflation control is still the priority number one.
May retail sales stoke inflation worries
Stronger-than-expected retail sales in May showed people are still spending, especially on cars, even with high gas prices.
While that sounds good, it raised fresh worries about inflation sticking around and pushed up expectations for a December rate hike, adding more uncertainty to an already jumpy market.