U.S. stocks and bonds finished lower as the Federal Reserve's latest rate hike failed to soothe market fears, with the 10-year Treasury yield climbing above 5% and oil prices remaining a persistent inflationary threat.
The Dow closed more than 600 points lower after the Fed's rate hike failed to calm markets.
WTI crude prices have climbed back above $100 a barrel and remain elevated due to the ongoing Iran conflict.
Brent crude is also above $100 a barrel with analysts warning it could reach $125 if oil supply risks persist.
The 10-year Treasury yield ended above the key 5% level, reflecting falling bond prices and persistent rate pressure.
The Dow Jones Industrial Average plummeted over 600 points as investors reacted to the Federal Reserve's commitment to aggressive inflation targeting. Despite a rate hike, bond yields surged past the 5% threshold, while oil prices remained elevated above $100 per barrel due to ongoing geopolitical tensions in Iran. Markets now face heightened volatility as the Fed signals further potential hikes.
Investors were unsettled by the Fed's firm commitment to aggressive inflation targets, which suggests a longer and more intense cycle of interest rate hikes than previously anticipated.
The ongoing conflict has kept crude oil prices elevated above $100 per barrel, creating inflationary pressure that the Federal Reserve cannot directly mitigate through monetary policy.