Stocks fell on Wall Street and bond yields rose Wednesday after Federal Reserve officials signaled they may start easing off the accelerator on their massive support for markets and the economy earlier than previously thought. The S&P 500 fell 0.5% after a highly anticipated set of projections by Fed policymakers showed some see short-term rates rising half a percentage point by late 2023, the AP reports. The Fed’s chair also said the central bank has begun talking about the possibility of pulling back on its $120 billion in monthly bond purchases meant to keep longer-term rates low. The S&P 500 fell 22.89 points to 4,223.70.The Dow Jones Industrial Average fell 265.66 points, or 0.8%, to 34,033.67. The Nasdaq fell 33.17 points, or 0.2%, to 14,039.68.
Super-low interest rates have been one of the main fuel sources for the stock market's rocket ride to records, with its most recent coming on Monday. Investors' immediate reaction to the Fed's comments was to send stocks lower and bond yields higher. But the moves moderated as the Fed's chair, Jerome Powell, said in a press conference that any changes are likely some time away. Powell said the bigger near-term change for markets will be when the Fed slows its monthly bond purchases. He said they'll continue until "substantial further progress has been made" in getting the economy to full employment and prices to be stable. But he acknowledged that conditions have improved enough to start discussing them. "You can think about this meeting as the talking about talking about meeting," he said
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