# Stock market tumbles as inflation fears spark rate hike bets > U.S. equities fell sharply Wednesday as surging Treasury yields and hot inflation data raised expectations for more Federal Reserve interest rate increases. - Title: Stock market tumbles as inflation fears spark rate hike bets - Summary: U.S. equities fell sharply Wednesday as surging Treasury yields and hot inflation data raised expectations for more Federal Reserve interest rate increases… - Keywords: stock market decline, s&p 500, nasdaq, dow jones, treasury yields, federal reserve, interest rate hikes, inflation, purchasing managers index, fed governor michael barr, mortgage rates, oil prices - Source: CNBC — https://cnbc.com/2026/09/22/stock-market-today-live-updates.html - Author: Sean Conlon,Chloe Taylor,Justina Lee,Tobias Burns - Published: 2026-09-22T22:02:38+00:00 - Read time: 4 min - Topics: stock market decline, s&p 500, nasdaq, dow jones, treasury yields, federal reserve, interest rate hikes, inflation, purchasing managers index, fed governor michael barr, mortgage rates, oil prices ## Stocks tumble on rate hike fears The S&P 500 dropped 0.75%, the Nasdaq fell 1.13%, and the Dow lost 352 points as Treasury yields surged on inflation concerns. Investors now fear the Federal Reserve will raise rates multiple times. ## Treasury yields hit 19-year highs The 10-year Treasury yield jumped to 5.135%, its highest level since July 2007, while the 2-year yield hit 4.947%, the highest since May 2024. The moves reflect expectations for more Fed rate hikes. ## Hot inflation data spooks markets Purchasing managers' index readings came in stronger than expected, signaling persistent inflation pressures across services and manufacturing. Price pressures hit their highest levels since October 2022. ## Fed sees more rate hikes ahead Federal Reserve Governor Michael Barr said Wednesday that further policy adjustments are likely needed to control inflation. Economic growth is strong and the labor market is solid, but inflation remains above target. > Further policy adjustments are likely to be needed to get inflation under control. ## October rate hike odds surge Odds of a quarter-point Fed rate hike in October jumped above 66%, up from 55.4% a day earlier and just 8.8% one month ago. The shift reflects growing conviction that more tightening is coming. ## Utilities and consumer stocks lead losses Utilities dropped 1.7% and consumer discretionary fell 1.5%, making them the worst-performing sectors. Energy was the only major gainer, rising 1.1% as oil prices climbed. ## Inflation pressures broaden beyond oil Procyon's Massimo Santicchia told CNBC that inflation is not just driven by oil but is broader, particularly in services. The Fed has no choice but to keep raising rates, likely two to three more times. > There's no way that the Fed is going to lower rates or pause at this point. ## Boston Fed warns inflation staying high Boston Federal Reserve President Susan Collins said there is an increased likelihood that inflation will stay notably above the Fed's 2% target. She backed last week's quarter-point rate hike as necessary. ## Mortgage rates climb to 2024 highs The average 30-year fixed mortgage rate rose to 7.12% from 6.97%, reaching levels not seen since 2024. Mortgage applications fell while adjustable-rate mortgage applications rose. ## Oil prices surge on supply concerns Brent crude futures for November delivery advanced 3.9% to $103.08 a barrel, while U.S. West Texas Intermediate crude rose 1.8% to $92.16. Oil gains reflect ongoing supply disruption worries. ## Trump weighs Iran deal or confrontation President Trump said U.S. and Iranian officials met for three hours at the UN General Assembly, calling it a very good meeting. He also said he faces a big decision on whether to reach a deal with Tehran or annihilate the country. ## Oil industry warns on diesel export ban The oil industry has warned that a diesel export ban would backfire and worsen the global fuel crisis. Trump appeared to back the ban this week, facing political pressure to tackle rising fuel prices before November midterms. ## McDonald's plunges on weak outlook McDonald's shares fell more than 5% to their lowest since 2022 after CEO Chris Kempczinski warned that high inflation and flat traffic will continue to weigh on the restaurant industry. U.S. same-store sales grew just 0.8%. ## Cracker Barrel beats on earnings Cracker Barrel Old Country Store climbed 5% after reporting fiscal fourth-quarter adjusted earnings per share of 99 cents, up from 74 cents last year. Revenue of $849.3 million beat Wall Street estimates. ## IonQ surges on quantum breakthrough IonQ shares jumped more than 13% after the company successfully tested the first real-time quantum error decoder. The technology allows error correction across operations without slowing execution time. > Successfully validating real-time decoding across hundreds of logical qubits and over millions of logical operations is an important milestone. ## Worthington rallies on data center demand Worthington Enterprises surged 16% on an encouraging outlook from CEO Joseph Hayek. The company is seeing rapidly growing demand for engineered tanks used in liquid cooling systems for data centers. ## Tekever hits $6.4 billion valuation AI drone maker Tekever reached a $6.4 billion valuation after raising $580 million, as Europe races to rearm amid the Ukraine war. The company's drones have logged over 50,000 operational flight hours in Ukraine since 2022. ## CFTC warns on prediction market risks CFTC Chairman Michael Selig told CNBC that activity on mentions contracts, where traders predict what someone will say in a speech or earnings call, are concerning. The regulator is taking a hard approach to evaluating these contracts. ## Bitcoin holds above $86,000 Bitcoin traded around $86,251 early Wednesday, near its highest level since late January. Ether was also down slightly at just over $2,748, while Ripple added 1.7% to trade at $1.61. ## Asian markets mixed on geopolitical hopes South Korea's Kospi rose 0.9% while China's CSI 300 fell 0.6%. Markets were buoyed by hopes of a diplomatic solution to Middle East tensions following U.S.-Iran talks, which eased oil price concerns. ## Key takeaway Rising inflation pressures and strong economic data are pushing investors to bet on additional Fed rate hikes, weighing on stocks and lifting borrowing costs across the economy.