U.S. stocks fell for the first time in four days Tuesday after comments from new Federal Reserve Chair Jerome Powell sent rates higher.
The new chair signaled the central bank could hike rates more than three times this year in an effort to keep the economy from overheating, sparking anxiety among equity traders.
The Dow Jones industrial average fell 299.24 points Tuesday to close at 25,410.03, with Disney and Home Depot weighing down the 30-stock index. The S&P 500 fell 1.27 percent to finish at 2,744.28 as real estate, consumer discretionaries and telecommunications pulled the broader market lower.
The Dow and S&P remain 4.5 percent and 4.4 percent off their all-time highs respectively.
The Nasdaq composite fell 1.23 percent to close at 7,330.35 amid declines in Facebook, Amazon, Apple, Netflix and Google-parent Alphabet.
Jerome Powell addressed Congress on Tuesday, detailing the central bank’s outlook for monetary policy and economic growth for the coming years. Asked about rate hikes in 2018, the Fed Chair signaled that the option for more than three increases remains open.
“We’ve seen some data that in my case will add some confidence to my view that inflation is moving up to target,” Powell told lawmakers. “We’ve also seen continued strength around the globe. And we’ve seen fiscal policy become more stimulative. So I think each of us is going to be taking the developments since the December meeting.”
Powell said individual Fed members will be crafting new projections at the central bank’s meeting in March, which would be influenced by federal government’s ambitious fiscal policies including tax cuts.