US stocks fall as Federal Reserve begins policy meet over rate hike

US stocks mostly tumbled on Tuesday as the Federal Reserve Bank began its crucial two-day policy meeting to take decision of possible hike in the interest rates.

The trading was witnessed mostly volatile in other asset classes. The prices of crude oil edged lower and continued to remain on track for their eighth decline in the last nine sessions. However, they were well off lows of the day. The US dollar index turned flat as it rebounded off the earlier weakness.

Amid the restlessness at the Wall Street, the investors and market analysts closely watched for crucial signs of when the key interest rates will be raised by the US central bank.

The investors eagerly awaited the release of policy statement by the Federal Reserve on Wednesday afternoon. Several market and financial analysts expected the central bank to opt for removing the word “patient” from its policy statement for describing its approach to hike interest rates later in the year. With the move, the Federal Reserve will come a step closer to its first interest rate hike since 2006.

The greenback’s European counterpart, euro, increased against the US dollar for a second consecutive session, though the currency was off its session peak. The European currency had recently hit a 12-year low.

The US crude oil hit a six-year low of USD 42.63 per barrel before paring the losses to trade down 0.2 percent, at USD 43.79. The price of Brent crude dropped 1.3 percent to USD 53.22 per barrel.

The Dow Jones industrial average plunged 137.69 points, or 0.77 percent, to 17,839.73. While the S&P 500 fell 9.54 points, or 0.46 percent, to 2,071.65; the Nasdaq Composite declined 4.05 points, or 0.08 percent, to 4,925.46.

The MSCI International ACWI price index dropped 0.2 percent while the European shares closed 0.7 percent lower, a day after hitting a high of seven and half years.

The US dollar index was flat at 99.612. The index, which measures the American currency against a basket of major counterparts, on Monday posted its biggest fall in more than a month.

The benchmark 10-year US Treasury note increased 11/32 in price, forcing the yield down to 2.0594 percent.

The prices of gold tumbled 0.4 percent, while silver fell 0.4 percent.