The Fed held its benchmark policy rate at 5-5.25%, breaking a streak of 10 straight increases.
See what changed in the Fed statementStocks drop after Federal Reserve indicates more interest rate hikes are coming
The S&P 500 and the Nasdaq Composite shed earlier gains and turned negative shortly after the central bank indicated that though it was pausing on a June hike, the "dot plot" showed two more increases are coming. The S&P 500 dropped 0.6%, while the Nasdaq fell 0.7%. The Dow Jones Industrial Average lost more than 400 points, or about 1.2%.The central bank is skipping a rate hike at its June meeting, as investors had expected. This move leaves the key fed funds rate steady at a range of 5% to 5.25%.
The Fed indicated that more increases will be coming after this pause, however. The announcement sent stocks lower.
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