Fed Holds Rates at 3.5% as Oil Tops $104 and Wholesale Inflation Surges, Sending Stocks Lower

The Federal Reserve held its benchmark interest rate steady on Wednesday, leaving borrowing costs in the 3.5-to-3.75-percent range as central bankers confronted an economy caught between surging energy prices and a slowing labor market. The decision, widely anticipated by traders who had priced in a 99 percent probability of no change according to CME FedWatch data, came just hours after a batch of inflation data delivered an unwelcome surprise Stock market today: Dow, S&P 500, Nasdaq rise for second day in a row with Fed decision on deckfinance.yahoo.com·SecondaryUS stocks gained ground on Tuesday, continuing a cautious rebound as fresh attacks in the Iran war drove oil prices higher amid questions over the US push for allies to help protect shipping in the Strait of Hormuz. The Dow Jones Industrial Average (^DJI) gained roughly 0.1%, building on Monday's rebound. Meanwhile, the S&P 500 (^GSPC) and Nasdaq Composite (^IXIC) picked up 0.3% and 0.5%, respectively..

Wall Street sold off sharply in response. The Dow Jones Industrial Average fell nearly 0.9 percent on Wednesday, shedding more than 400 points after two consecutive winning sessions. The S&P 500 and the tech-heavy Nasdaq Composite each lost about 0.5 percent as the combination of hawkish Fed signaling and an accelerating inflation picture weighed on investor sentiment Stock market today: Dow, S&P 500, Nasdaq futures rise as oil tops $104 again with Fed decision on deckfinance.yahoo.com·SecondaryUS stocks fell on Wednesday after the latest reading on prices pointed to accelerating inflation as investors waited for the Federal Reserve’s latest policy decision. The Dow Jones Industrial Average (^DJI) lost nearly 0.9%, or more than 400 points, following a second winning day in a row for Wall Street stocks. The S&P 500 (^GSPC) and tech-focused Nasdaq Composite (^IXIC) each fell about 0.5%. Wholesale inflation accelerated 0..

The catalyst for much of the selling was the February Producer Price Index, released hours before the rate decision. Wholesale prices rose 0.7 percent month-over-month, more than double the 0.3 percent economists had forecast and up from January's 0.5 percent gain. On a year-over-year basis, headline PPI climbed to 3.4 percent, surpassing estimates of 3.0 percent and the prior month's 2.9 percent reading. Core producer prices, excluding food and energy, advanced 3.9 percent year-over-year, also above expectations Stock market today: Dow, S&P 500, Nasdaq futures rise as oil tops $104 again with Fed decision on deckfinance.yahoo.com·SecondaryUS stocks fell on Wednesday after the latest reading on prices pointed to accelerating inflation as investors waited for the Federal Reserve’s latest policy decision. The Dow Jones Industrial Average (^DJI) lost nearly 0.9%, or more than 400 points, following a second winning day in a row for Wall Street stocks. The S&P 500 (^GSPC) and tech-focused Nasdaq Composite (^IXIC) each fell about 0.5%. Wholesale inflation accelerated 0..

The Bureau of Labor Statistics noted that nearly 30 percent of the February increase in processed goods for intermediate demand was attributable to diesel fuel prices, which jumped 13.9 percent over the month. Broader energy goods and energy materials rose 5.5 percent and 6.0 percent respectively, underscoring the degree to which the Middle East conflict has begun bleeding into domestic price pressures Stock market today: Dow, S&P 500, Nasdaq futures rise as oil tops $104 again with Fed decision on deckfinance.yahoo.com·SecondaryUS stocks fell on Wednesday after the latest reading on prices pointed to accelerating inflation as investors waited for the Federal Reserve’s latest policy decision. The Dow Jones Industrial Average (^DJI) lost nearly 0.9%, or more than 400 points, following a second winning day in a row for Wall Street stocks. The S&P 500 (^GSPC) and tech-focused Nasdaq Composite (^IXIC) each fell about 0.5%. Wholesale inflation accelerated 0..

At the center of the storm is the oil market. Brent crude futures climbed to $104 a barrel on Wednesday, continuing a conflict-driven rally that has transformed the global energy landscape since the outbreak of war between the United States and Iran on February 28. West Texas Intermediate crude traded near $98. On the physical market, the disconnect was even starker: spot prices for Dubai and Oman oil grades were trading around $158 per barrel, roughly $55 above the Brent futures benchmark, according to Bloomberg data — suggesting that futures prices may significantly understate the true cost of oil Stock market today: Dow, S&P 500, Nasdaq futures rise as oil tops $104 again with Fed decision on deckfinance.yahoo.com·SecondaryUS stocks fell on Wednesday after the latest reading on prices pointed to accelerating inflation as investors waited for the Federal Reserve’s latest policy decision. The Dow Jones Industrial Average (^DJI) lost nearly 0.9%, or more than 400 points, following a second winning day in a row for Wall Street stocks. The S&P 500 (^GSPC) and tech-focused Nasdaq Composite (^IXIC) each fell about 0.5%. Wholesale inflation accelerated 0..

The national average for US diesel crossed $5 per gallon on Tuesday, the first time it had reached that level since December 2022. Diesel is a mainstay of the American economy, fueling the trucks, trains, and ships that move goods across the country. Spikes in diesel prices tend to ripple quickly through freight costs, agriculture, and consumer inflation. Goldman Sachs strategists warned that roughly 2.2 million barrels per day of global refining capacity had been taken offline by a combination of direct damage and precautionary shutdowns across the Middle East Stock market today: Dow, S&P 500, Nasdaq rise for second day in a row with Fed decision on deckfinance.yahoo.com·SecondaryUS stocks gained ground on Tuesday, continuing a cautious rebound as fresh attacks in the Iran war drove oil prices higher amid questions over the US push for allies to help protect shipping in the Strait of Hormuz. The Dow Jones Industrial Average (^DJI) gained roughly 0.1%, building on Monday's rebound. Meanwhile, the S&P 500 (^GSPC) and Nasdaq Composite (^IXIC) picked up 0.3% and 0.5%, respectively..

The effective closure of the Strait of Hormuz has compounded the crisis. Iran has maintained its blockade of the critical waterway, which normally handles roughly 12.8 million barrels per day of crude oil bound for Asian refineries, plus an additional 3.3 million barrels per day of refined products. Bob McNally, president of Rapidan Energy Group and a former White House official, assessed that it could take several weeks to secure the strait, adding that commercial and escort ships should not be sent through until Iran's layered asymmetric capabilities — mines, fast attack craft, submarines, and drones — have been neutralized Stock market today: Dow, S&P 500, Nasdaq futures rise as oil tops $104 again with Fed decision on deckfinance.yahoo.com·SecondaryUS stocks fell on Wednesday after the latest reading on prices pointed to accelerating inflation as investors waited for the Federal Reserve’s latest policy decision. The Dow Jones Industrial Average (^DJI) lost nearly 0.9%, or more than 400 points, following a second winning day in a row for Wall Street stocks. The S&P 500 (^GSPC) and tech-focused Nasdaq Composite (^IXIC) each fell about 0.5%. Wholesale inflation accelerated 0..

President Trump moved on Wednesday to ease some of the domestic pressure, issuing a temporary 60-day waiver of the Jones Act, which normally requires that cargo moving between US ports be transported on American-built, American-crewed vessels. White House press secretary Karoline Leavitt described the move as another step to mitigate short-term disruptions while the military continued meeting the objectives of Operation Epic Fury Stock market today: Dow, S&P 500, Nasdaq futures rise as oil tops $104 again with Fed decision on deckfinance.yahoo.com·SecondaryUS stocks fell on Wednesday after the latest reading on prices pointed to accelerating inflation as investors waited for the Federal Reserve’s latest policy decision. The Dow Jones Industrial Average (^DJI) lost nearly 0.9%, or more than 400 points, following a second winning day in a row for Wall Street stocks. The S&P 500 (^GSPC) and tech-focused Nasdaq Composite (^IXIC) each fell about 0.5%. Wholesale inflation accelerated 0..

But the waiver addresses only a fraction of the problem. In a further escalation on Wednesday, Israel confirmed it had struck Iran's South Pars gas field, one of the largest natural gas formations in the world. Iran shares access to the field with Qatar. European natural gas futures surged roughly 8 percent on the news, adding to a more than 80 percent jump in prices on the Dutch TTF exchange over the past month Stock market today: Dow, S&P 500, Nasdaq futures rise as oil tops $104 again with Fed decision on deckfinance.yahoo.com·SecondaryUS stocks fell on Wednesday after the latest reading on prices pointed to accelerating inflation as investors waited for the Federal Reserve’s latest policy decision. The Dow Jones Industrial Average (^DJI) lost nearly 0.9%, or more than 400 points, following a second winning day in a row for Wall Street stocks. The S&P 500 (^GSPC) and tech-focused Nasdaq Composite (^IXIC) each fell about 0.5%. Wholesale inflation accelerated 0..

Iran responded by publishing a list of potential retaliatory targets across the Gulf, including Qatar's Ras Laffan refinery, Saudi Arabia's Samref oil refinery, and the Al Hosn gas field in the UAE. Iran's military operational command declared that targeting the energy infrastructure of any country involved was legitimate cause for retaliation and promised to respond with severity Stock market today: Dow, S&P 500, Nasdaq futures rise as oil tops $104 again with Fed decision on deckfinance.yahoo.com·SecondaryUS stocks fell on Wednesday after the latest reading on prices pointed to accelerating inflation as investors waited for the Federal Reserve’s latest policy decision. The Dow Jones Industrial Average (^DJI) lost nearly 0.9%, or more than 400 points, following a second winning day in a row for Wall Street stocks. The S&P 500 (^GSPC) and tech-focused Nasdaq Composite (^IXIC) each fell about 0.5%. Wholesale inflation accelerated 0..

For Chair Jerome Powell and his colleagues, the oil shock has created what Powell described as a difficult situation. The Fed must balance downside risks to the labor market — which would normally call for lower rates — against upside risks to inflation, which argue for keeping rates elevated or even hiking. Powell acknowledged on Wednesday that the central bank was not seeing the progress on inflation it had hoped for and warned that if global oil supply disruptions lasted longer than expected, the economic impact could exceed what markets had priced in.

The Fed's updated Summary of Economic Projections, released alongside the rate decision, showed that officials had raised their 2026 inflation forecast to 2.7 percent from December's 2.5 percent projection. The closely watched dot plot indicated that the median committee member still expects one more quarter-point rate cut before year's end, but Powell noted that FOMC members had discussed the possibility of a rate hike at the April meeting if inflation data continued to deteriorate.

Markets did not take kindly to the message. At session lows during Powell's press conference, the Dow had fallen more than 600 points, or 1.3 percent. The 10-year Treasury yield edged up 2 basis points to 4.22 percent at the open, reflecting expectations that rates would remain higher for longer Stock market today: Dow, S&P 500, Nasdaq futures rise as oil tops $104 again with Fed decision on deckfinance.yahoo.com·SecondaryUS stocks fell on Wednesday after the latest reading on prices pointed to accelerating inflation as investors waited for the Federal Reserve’s latest policy decision. The Dow Jones Industrial Average (^DJI) lost nearly 0.9%, or more than 400 points, following a second winning day in a row for Wall Street stocks. The S&P 500 (^GSPC) and tech-focused Nasdaq Composite (^IXIC) each fell about 0.5%. Wholesale inflation accelerated 0..

The energy sector continued to be the standout beneficiary of the turmoil. Exxon Mobil has posted 17 intraday record highs in 2026, with shares up more than 30 percent year-to-date. Valero Energy has surged 45 percent this year, while Liberty Energy has climbed more than 70 percent. The broader energy sector has set its 16th record intraday high of the year Stock market today: Dow, S&P 500, Nasdaq rise for second day in a row with Fed decision on deckfinance.yahoo.com·SecondaryUS stocks gained ground on Tuesday, continuing a cautious rebound as fresh attacks in the Iran war drove oil prices higher amid questions over the US push for allies to help protect shipping in the Strait of Hormuz. The Dow Jones Industrial Average (^DJI) gained roughly 0.1%, building on Monday's rebound. Meanwhile, the S&P 500 (^GSPC) and Nasdaq Composite (^IXIC) picked up 0.3% and 0.5%, respectively..

Outside of energy, pockets of strength were visible but narrow. Bitcoin traded near $74,000 on Tuesday, having risen roughly 10 percent since the war began, outperforming both the S&P 500, which declined 2 percent, and gold, which dropped nearly 4 percent over the same period. Bernstein analyst Gautam Chhugani attributed the resilience to $2.1 billion in exchange-traded fund inflows over three weeks driven by institutional allocations Stock market today: Dow, S&P 500, Nasdaq rise for second day in a row with Fed decision on deckfinance.yahoo.com·SecondaryUS stocks gained ground on Tuesday, continuing a cautious rebound as fresh attacks in the Iran war drove oil prices higher amid questions over the US push for allies to help protect shipping in the Strait of Hormuz. The Dow Jones Industrial Average (^DJI) gained roughly 0.1%, building on Monday's rebound. Meanwhile, the S&P 500 (^GSPC) and Nasdaq Composite (^IXIC) picked up 0.3% and 0.5%, respectively..

On the corporate front, a flurry of activity at Nvidia's GTC conference provided a partial counterweight. CEO Jensen Huang disclosed that the company expects AI chip sales to surpass $1 trillion by 2027 and revealed purchase orders for China-bound chips Stock market today: Dow, S&P 500, Nasdaq rise for second day in a row with Fed decision on deckfinance.yahoo.com·SecondaryUS stocks gained ground on Tuesday, continuing a cautious rebound as fresh attacks in the Iran war drove oil prices higher amid questions over the US push for allies to help protect shipping in the Strait of Hormuz. The Dow Jones Industrial Average (^DJI) gained roughly 0.1%, building on Monday's rebound. Meanwhile, the S&P 500 (^GSPC) and Nasdaq Composite (^IXIC) picked up 0.3% and 0.5%, respectively.. Elsewhere, Macy's beat fourth-quarter estimates with adjusted earnings of $1.84 per share against expectations of $1.54, sending shares up 7 percent in premarket trading, while Delta Air Lines rose 4 percent after raising its first-quarter revenue target Stock market today: Dow, S&P 500, Nasdaq futures rise as oil tops $104 again with Fed decision on deckfinance.yahoo.com·SecondaryUS stocks fell on Wednesday after the latest reading on prices pointed to accelerating inflation as investors waited for the Federal Reserve’s latest policy decision. The Dow Jones Industrial Average (^DJI) lost nearly 0.9%, or more than 400 points, following a second winning day in a row for Wall Street stocks. The S&P 500 (^GSPC) and tech-focused Nasdaq Composite (^IXIC) each fell about 0.5%. Wholesale inflation accelerated 0..

But the positive corporate news could not overcome the macro headwinds. The convergence of a hot inflation print, triple-digit oil, a hawkish Fed, and an expanding war in the Middle East has left investors with few places to hide. As Goldman Sachs analysts summarized the situation, prices for refined products have rallied far more than crude itself, and no products or regions are fully immune from the disruption Stock market today: Dow, S&P 500, Nasdaq futures rise as oil tops $104 again with Fed decision on deckfinance.yahoo.com·SecondaryUS stocks fell on Wednesday after the latest reading on prices pointed to accelerating inflation as investors waited for the Federal Reserve’s latest policy decision. The Dow Jones Industrial Average (^DJI) lost nearly 0.9%, or more than 400 points, following a second winning day in a row for Wall Street stocks. The S&P 500 (^GSPC) and tech-focused Nasdaq Composite (^IXIC) each fell about 0.5%. Wholesale inflation accelerated 0..

The question now is whether this is a temporary energy shock that will ease once the conflict moderates, or the beginning of a more sustained inflationary episode that forces the Fed's hand. Powell offered no clear answer on Wednesday, acknowledging only that no one truly knows what the effects of the war will be. For markets already stretched thin by geopolitical uncertainty, that ambiguity was enough to push stocks to their worst levels of the day.