The Dow fell more than 300 points, or 1.1%, in late morning trading. The S&P 500 was also down about 1% while the tech-heavy Nasdaq slipped a more modest 0.5%.
There were no earnings reports of note on Tuesday and not much economic data for investors to focus on other than a new housing report, which was mixed. Housing starts for August rose more than 12% from July, but building permits were down 10%.
The housing numbers are unlikely to change the minds of Fed policy makers, who will announce another rate hike on Wednesday. The market is pricing in a nearly 85% chance of a third consecutive three-quarters of a percentage point increase.
But there are some who believe the Fed will be even more aggressive and raise rates by an unprecedented full percentage point.
Tuesday’s market sell-off follows a modest rally to start the week. Stocks surged at the end of the trading session Monday after hovering near break-even levels for most of the day.
But the market has had a tough couple of days, falling in the past week after a shocking earnings warning from FedEx (FDX), which raised more worries about the health of the global economy and Corporate America.
