us stock indexes traded lower on wednesday afternoon after the federal reserve announced the fourth straight jumbo increase in its benchmark interest rate and hinted at a potential slowdown in its effort to tighten monetary policy to bring down inflation however powell said in his press conference that it is very premature to be thinking about pausing and the ultimate target for increases in interest rates may be higher than previously expected on tuesday the dow jones industrial average fell 80 points or 024 to 32653 the sp 500 declined 16 points or 041 to 3856 and the nasdaq composite dropped 97 points or 089 to 10891 the nasdaq composite is up 55 from its 2022 closing low but remains down 304 for the year to date the federal reserve on wednesday approved the fourth straight jumbo increase in its benchmark interest rate extending a rapid pace of hikes that brings the rate to the highest level in 15 years by a unanimous vote the fed hiked its rate by 075 percentage points to a range of 375 to 4 also for the first time the central bank signaled it would watch closely whether this rapid pace might eventually damage the economy with a lag see fed approves another jumbo interestrate hike adds dovish language on way forward chairman jerome powell acknowledged in a press conference after the announcement that at some point it will be appropriate to slow the pace of increases but he also said it is very premature to talk about a pause in raising interest rates powell emphasized that the fomc has more work to do and he suggested that the ultimate level of the federal funds may be higher than the committee expected in september us stocks rallied after the central banks announcement but a morehawkishthanexpected powell who spoke only thirty minutes after the statement sent stocks sharply lower and treasury yields and fed funds futures higher us benchmark bond yields turned broadly lower with the yield on the 10year treasury was 3995 down from 4052 on tuesday the market is now pricing in a 52 chance of just a halfpoint rate increase at the feds december 14 meeting according to the cme fedwatch tool that would leave rates in a range of 425 to 45 with rates now well into restrictive territory the fed can afford to slow the pace of rate hikes partly to assess what impact the near 400bp of cumulative tightening is having said paul ashworth chief north america economist at capital economics in a note sent to clients after the feds annoucement barring another upside inflation surprise in the october and november cpi reports which we cant completely rule out it looks like the fed is laying the groundwork to shift down to a 50bp hike in december and if were right that core inflation will start to show signs of slowing soon a 25bp rate hike at the january meeting next year see heres how fed day stockmarket performance stacks up under jerome powell in us economic data reported earlier wednesday payroll services firm adp said the private sector added 239000 jobs in october economists polled by the wall street journal earlier forecasted an increase of 195000 jobs i think the adp data was a bit more robust than folks thought said timothy holland chief investment officer at orion advisor solutions the market is really hoping that the fed can credibly pivot to just a 50 basis point rate hike in december and then maybe even downshift from there in 2023 according to holland youve seen some softness in the economy but youre not really seeing it in the labor market necessarily and can the fed credibly downshift if youre not getting softness on the jobs front and thats the big question holland said also helping support stocks was a wellreceived earnings report from chipmaker amd amd delivered after tuesdays closing bell companies reporting on wednesday include paramount global para zillow z and ebay ebay meanwhile in china investors continued to bet on rumors that beijing was considering relaxing its covid19 lockdown policy the hang seng china enterprises index  which closed on monday at a 17year low having fallen about 40 so far in 2022 took its twoday rebound to 82 separately china has ordered a sevenday lockdown of the area around foxconn technology groups main plant in zhengzhou which houses an iphone assembly plant and the worlds largest iphone factory