US stocks are surging on Wall Street Wednesday, on track
for their first gain in six days, but more turbulence may be ahead when the
Federal Reserve announces in the afternoon how sharply it’s raising interest
rates
.

The S&P 500 rose 48.32 points or 1.31% to 3,784 as
investors are ready for the Fed’s rate hike, which most investors expect to be
triple the usual amount and the sharpest since 1994. The Dow Jones Industrial
Average was up 331.31 points or 1.09% to 30,696.14 as of 10:20 a.m. Eastern
time zone. The Nasdaq composite was 184.59 points or 1.67% lower at 11,008.42.

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Global investments, from bonds to bitcoin, have fallen
this year due to high inflation, as the Federal Reserve and other central banks
rapidly remove support propped beneath markets early in the pandemic. Investors
are concerned that too-aggressive hikes in interest rates will force the
economy into a recession.

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Treasury yields have surged to their highest levels in
over a decade on expectations for a more aggressive Fed, though they eased on
Wednesday. A weaker-than-expected report showing that sales at US retailers
unexpectedly slumped in May from April disappointed investors. So did a
disappointing report on manufacturing in New York state.

The economy is still largely holding up amid a red-hot
job market, but it has shown signs of distress recently. According to a
preliminary report last week, consumer sentiment sank to its lowest reading on
record due in large part to high gasoline prices.

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The yield on the 10-year Treasury slipped to 3.31% from
3.48% late Tuesday. The two-year Treasury, which more closely follows
expectations of Fed action, declined to 3.39% from 3.45%.

Cryptocurrency prices continued to plunge, and bitcoin
dropped as low as $20.087.90, nearly 71% below its record high of $68,990.90
touched in November 2021. Its fall has worsened as investors ramp up their
expectations for how aggressively the Fed will move on interest rates.

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Wall Street is expecting a hike of three-quarters of a
percentage point. But a report on Friday upset the markets when it showed
consumer prices rose unexpectedly last month.

It dashed hopes on Wall Street that inflation may already
touch its peak, and the data seemingly pinned the Federal Reserve into having
to get more aggressive. Other central banks around the world are also raising
interest rates, adding to the pressure.