Fed's Rate Decision Jolts Wall Street Amid Economic Uncertainty

U.S. stocks seesawed before closing lower following Federal Reserve Chair Jerome Powell's remarks, which downplayed the likelihood of a September rate cut. While economic growth appeared robust on the surface, underlying indicators suggested waning strength. Key earnings reports and tariff announcements also influenced market movements.

U.S. stocks closed sharply lower Wednesday after a volatile trading session, as remarks from Federal Reserve Chair Jerome Powell dampened earlier optimism about a potential rate cut in September.

Investors were initially optimistic after the Fed kept interest rates steady, citing low unemployment and a solid labor market. However, the mood shifted when Powell indicated it was too early to predict a rate cut, causing market expectations to waver.

Earnings reports from major companies like Microsoft and Meta buoyed stocks temporarily, but persisting concerns over tariffs, especially on materials, exerted downward pressure. Market volume remained robust, with mixed performance across major indices.

(With inputs from agencies.)