U.S. stocks closed sharply lower on Wednesday, giving up earlier gains, after the Federal Reserve raises interest rates by 25 basis points as expected, but talked down the possibility of cuts to rates this year. The Dow Jones Industrial Average DJIA, -1.63% tumbled 531 points, or 1.6%, ending near 32,028, while the S&P 500 index SPX, -1.65% shed 1.7% and the Nasdaq Composite Index COMP, -1.60% closed down 1.6%, according to preliminary FactSet figures. Fed Chairman Jerome Powell said the U.S. banking system remained resilient after it and regulators rolled out liquidity measures to help shore up confidence in the banking system after the collapse of Silicon Valley Bank and Signature Bank earlier in March. Powell also said that tighter credit conditions for consumers, following the bank failures, would likely work like rate hikes in terms of lowering inflation. It will be a key area of focus for the Fed in the coming weeks and months, he said. The 10-year Treasury rate TMUBMUSD10Y, 3.468% fell Wednesday to 3.46%, a sign that investors in the bond market think growth will be slower.
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