Stock markets closed on Wednesday with significant losses, although the Federal Reserve kept interest rates closed at almost zero, amid unusual trading activity fueled by online amateur investors.
The Dow Jones Industrial Average lost 635 points, or 2.1 percent, the biggest drop in three months, while the S&P 500 erased earnings for the year, falling 98.8 points, or 2 , 6 percent.
The losses were squandered by Federal Reserve Chairman Jerome Powell, who backed additional fiscal support and dismissed concerns that rising inflation would lead.
President Biden is pushing for a $ 1.9 trillion COVID-19 relief package.
But markets, which have been growing steadily since the original pandemic shock hit early last year, plummeted amid an unusual phenomenon of amateur investors targeting certain stocks and sending their valuations through the roof, annoying short sellers.
Companies like GameStop have seen their ratings rise and fall at extraordinary rates, as online investment charts from sites like Reddit have run them. The value of GameStop has multiplied by six since the beginning of the year. Major hedge funds that are betting on falling stocks have retreated and have likely accumulated significant losses.