Stocks dipped for a second day on Wednesday and rates soared to new heights as investors bet the Federal Reserve is about to aggressively tighten policy to fight inflation, and in turn slow the economy.
The Dow Jones Industrials tumbled 202.33 to 34,438.83.
The S&P 500 slumped 50.18 points, or 1.1%, to 4,475.04
The NASDAQ Composite fell 327.49 points, or 2.3%, to 13,876.68.
Tech shares fell again on Wednesday following Tuesday's losses, as investors rotated out of the group and braced for higher rates to slow the economy. Apple, Microsoft, Amazon and Tesla contributed to the sector's declines and led the NASDAQ to fall again Tuesday.
Nvidia continued its descent on Wednesday, losing 6%, while Marvell Technology collapsed 4%. As the Federal Reserve hikes rates investors have begun searching for stocks with stable profits and shying away from those offering future growth.
Meanwhile, Twitter rose 1.5%, continuing its rally amid news that Elon Musk purchased a large stake in the company.
Utilities, health care and consumer staples sectors continued to climb Wednesday, with Amgen, Merck and Johnson & Johnson all rising about 2%. Consumer staples such as Walmart, Coca-Cola and Procter & Gamble also inched slightly higher.
Investors await minutes from the Fed's most-recent meeting slated for release Wednesday afternoon, which could impact investors' outlook and offer new clues to the Fed's plan to reduce its balance sheet.
It comes after comments from Fed officials knocked down stocks on Tuesday. The minutes come from last month's meeting when the central bank raised rates and indicated six more hikes were coming this year.
Treasury prices fell as yields spiked to 2.60%, from Tuesday's 2.55%. Treasury prices and yields move in opposite directions.
Oil prices skidded $2.55 to $99.41 U.S. a barrel.
Gold prices picked up three dollars to $1,930.50 U.S. an ounce.