US Stocks Trim Losses After Fed Leaves Rates Alone, Oil Prices Soar

Oil prices jumped on Wednesday as tensions in the Middle East escalated following Iran's launch of a barrage of missiles at American forces. The price of Brent crude surged 7.2% to $88.03 per barrel, its highest level since last week's peak of $102.

The jump in oil prices raised concerns that inflation could accelerate again, which had been slowing down more than expected. This had traders anticipating a roughly 34% probability of the Federal Reserve raising interest rates in response.

However, the Fed decided to keep the federal funds rate steady, with three members of the policymaking committee voting to raise rates instead. The decision was seen as a relief for technology stocks, which have been under pressure due to their high valuations and exceptional growth driven by artificial-intelligence technology.

The S&P 500 fell 0.5% after earlier dropping as much as 1.2%, while the Dow Jones Industrial Average declined 825 points or 1.6%. Apple's stock rose 0.9% to help limit losses, but Nvidia and other tech companies suffered significant declines.