The Dow Jones Industrial Average extended its historic losing streak, marking a 10th consecutive day of declines, its longest since 1974. The index fell 1,123.03 points, or 2.58%, to close at 42,326.87. The S&P 500 dropped 2.95% to 5,872.16, while the Nasdaq Composite lost 3.56%, ending at 19,392.69. Both indices experienced their worst day since August, with market losses intensifying toward the close of trading.

Bond yields surged following the Federal Reserve’s rate decision. The policy-sensitive two-year Treasury yield rose 10 basis points to 4.35%, while the 10-year yield climbed above 4.50%. Meanwhile, the Bloomberg Dollar Index reached its highest level since November 2022.

Federal Reserve Policy Update
The Federal Reserve reduced its overnight borrowing rate by 0.25 percentage points to a target range of 4.25%-4.50%. However, the central bank signaled a more cautious outlook for rate cuts in 2025, reducing the expected number from four to two. Fed Chair Jerome Powell emphasized the need for a cautious approach, stating that the current rate remains “meaningfully restrictive.” Powell also reaffirmed the Fed’s commitment to achieving its 2% inflation target, suggesting a prolonged restrictive monetary policy environment.

Market participants reacted negatively to the Fed’s updated forecast, with traders adjusting expectations for the pace of future rate cuts. Treasury yields jumped in response, adding pressure to equity markets.