US markets in the red ahead of Fed interest rate decision; Dow ends over 550 points in the red, Nasdaq slips over 300 points – market news

On Tuesday, U.S. stock markets posted a sharp decline, matching global markets' monthly losses, as investors awaited key economic data and the Federal Reserve's two-day policy meeting.

The Dow Jones Industrial Average fell 570.17 points, or 1.49%, to close at 37,815.92. The S&P 500 posted a loss of 80.49 points, or 1.57%, to end at 5,035.68, while the Nasdaq Composite fell 325.26 points, or 2.04%, to 15,657.82.

Gold prices fell, the dollar strengthened and benchmark U.S. Treasury yields rose after the U.S. Labor Department announced a larger-than-expected rise in first-quarter employment costs. This development is unlikely to change the Federal Reserve's tightening stance.

“The selloff was triggered by the higher-than-expected labor cost index,” said Jay Hatfield, portfolio manager at InfraCap in New York. “And investors are positioning themselves ahead of what is expected to be a hawkish press conference following the Fed meeting.”

The Federal Open Market Committee meets on Tuesday for its monetary policy meeting, which is expected to culminate on Wednesday with the decision to keep the federal funds rate in the range of 5.25% to 5.50%.

The accompanying statement and subsequent press conference from Fed Chair Jerome Powell will be examined for clues about the central bank's expected path forward on rate cuts.

(With Reuters input)