US stocks extended losses Wednesday morning ahead of the Federal Reserve’s decision on interest rates.
The Dow dropped 750 points, or 1.44%. The S&P 500 fell 0.75%, and the tech-heavy Nasdaq sank 1.1%.
The Dow erased its gains from yesterday, when it closed higher by 537 points. The index was set to snap a three-day winning streak.
As tech and AI stocks sold off in recent weeks, investors rotated into other sectors like financials and industrials, helping boost the Dow. But the blue-chip index tumbled on Wednesday as investors dumped stocks across different sectors.
Goldman Sachs (GS) and Caterpillar (CAT) each dropped about 4%, weighing on the Dow. The index is price-weighted, so the larger a company’s share price, the more influence it has. Goldman and Caterpillar have the largest share prices in the index.
All told, the Dow is down just 2% since hitting a record high above 53,000 points in early July.
Meanwhile, weakness in tech and AI continues to weigh on markets: The Nasdaq is down about 9% since its last record high in early June, putting it on the cusp of a so-called correction.
Elsewhere in markets, oil prices rose and Treasury yields moved higher. The US 10-year yield rose to 4.63%.