Interest Rate Stability Masks a Market Sell-Off Triggered by Oil Inflation

The Dow Jones Industrial Average fell 1.6% to its lowest level since November, while the S&P 500 dropped 1.4% to its same same level. The Nasdaq Composite lost 1.5%. These losses occurred after the Federal Reserve concluded a policy meeting on March 18 and maintained interest rates at current levels. The sell-off was driven by inflation measures that exceeded analyst expectations. Investors responded by selling bonds, which pushed the 10-year U.S. note yield to 4.26%. Fed Chair Jerome Powell cited uncertainty from the war in Iran as a reason for the stability of rates. Brent crude oil closed at $105 a barrel, up nearly 6%, and the nationwide average for a gallon of gas reached $3.86. The VIX Composite spiked nearly 10%.