US stocks: Nasdaq, S&P fall over 1% as Fed holds rates; traders raise hike bets

The US Federal Reserve held interest rates at the 3.50 percent to 3.75 percent range but adopted a hawkish stance, removing prior language hinting at rate cuts. Quarterly projections showed nine officials expect at least one rate hike by end-2026, pushing the probability of a December rate hike to nearly 38 percent. US markets fell sharply with the S&P 500 down 1.19 percent, Nasdaq down 1.32 percent, and Dow Jones down 0.96 percent, signaling risk-off sentiment that is likely to pressure Indian equities and FII flows.