Fed Rate Hike Sparks Sell-Off in Stocks Like SCHW and R
The Federal Reserve's decision to raise interest rates by 25 basis points to 3.75%, 4.00% on September 16 has sent shockwaves through the stock market, with several companies seeing their shares plummet.
Among those affected were Charles Schwab (SCHW), Raymond James Financial, Sallie Mae, Voya Financial, and WEX. The stocks fell after investors continued to bid them lower following the Fed's announcement, which highlighted slower loan demand, higher borrowing costs for consumers and businesses, potential credit deterioration, and softer capital-markets activity.
Charles Schwab's shares have been relatively stable, but today's move indicates that the market considers this news meaningful. The company has only had two moves greater than 5% over the last year, with its biggest drop being 6.9% in July when a new AI tool sparked concerns about disruption in the wealth management sector.
Investors who bought $1,000 worth of Charles Schwab's shares five years ago would now be looking at an investment worth $1,437, or flat since the beginning of the year. The stock is trading 11% below its 52-week high of $113.65 from August 2026.