Wall Street Falls After Fed Signals Possible Rate Hike This Year; Nasdaq Drops 1.34%

9 of 18 Fed officials see benchmark rate higher by year-end

U.S. stocks closed lower on June 17 as concerns mounted that the Federal Reserve could raise interest rates later this year.

The Dow Jones Industrial Average fell 507.12 points, or 0.98%, to 51,492.55 on the New York Stock Exchange. The S&P 500 dropped 91.25 points, or 1.21%, to 7,420.10, while the tech-heavy Nasdaq Composite lost 354.68 points, or 1.34%, to 26,021.66.

Big Tech shares led the decline. Meta Platforms sank 5.44%, Microsoft fell 3.79%, Amazon.com lost 3.46% and Alphabet dropped 2.53%. SpaceX, which had risen since its listing, fell 4.95% for its first daily decline.

Semiconductor stocks bucked the broader weakness in technology shares. Western Digital rose 4.56%, Intel gained 3.46% and Micron Technology added 2.20%. The Philadelphia Semiconductor Index ended up 1.38%.

The Fed left its benchmark rate unchanged at 3.50% to 3.75% at the first Federal Open Market Committee meeting under new Chair Kevin Warsh. Still, policymakers signaled through the dot plot that a rate increase this year remains on the table.

The dot plot showed that nine of 18 officials expect the benchmark rate at the end of this year to be above the current 3.50% to 3.75% range. The median year-end rate projection rose to 3.8% from 3.4% in March.

Oil prices rose after President Donald Trump said a memorandum of understanding to end the war with Iran was not a final agreement and that airstrikes could resume if he was dissatisfied with the outcome.

Brent crude for August settlement climbed 0.75% to $79.55 a barrel. West Texas Intermediate crude for July settlement rose 0.97% to $76.79 a barrel.

Lee Su, Hankyung.com reporter 2su@hankyung.com