Stocks slide as oil and yields push markets toward Fed decision

A late Tuesday selloff hit U.S. equities as oil rose sharply and bond yields climbed toward the 5% threshold¹.

The Dow fell 328 points to 52,093, the Nasdaq slid 204 to 25,981, and the S&P 500 slipped about 34 to 7,585 as traders prepared for the Fed decision¹. Futures and global markets reflected caution, with investors pricing in a quarter-point hike and weighing the impact of higher energy costs on growth².

The day’s mood darkened further as oil remained elevated near $105, while the 10-year yield hovered around its highest level since 2007, signaling tighter financial conditions and pressure on tech stocks^4,6,9,10. Analysts warned that the combination of rising oil, rising yields, and AI market anxiety could extend the pullback, though some argued the AI selloff might be short lived if the tech sector steadies after the Fed decision^9,23.

Investors waited for the Fed’s verdict and how it would steer the market’s next leg, with traders closely watching rate paths and the global energy backdrop^2,8.