**Market Jitters as Fed Alters Interest Rate Outlook: Stocks Tumble**
On December 18, 2024, the financial markets were rattled by the Federal Reserve’s unexpected move to scale back its anticipated interest rate cuts for 2025, leading to widespread sell-offs. The S&P 500 saw a dramatic drop of 3%, alongside the Dow Jones’ significant 2.6% tumble and Nasdaq’s 3.6% decline, reflecting heightened investor anxiety particularly in interest rate-sensitive sectors. Federal Reserve Chair Jerome Powell attributed the shift to robust employment figures and ascending inflation rates, compounded by uncertainties linked to new federal policies and President-elect Donald Trump’s tariff strategies. The resultant rise in Treasury yields further pressured smaller companies, with the Russell 2000 index experiencing a steep 4.4% fall.