U.S. stocks fell on Wednesday after the Federal Reserve hinted at a potential pause to its rate-hiking campaign in June but indicated rate cuts were unlikely.

The S&P 500 (^GSPC) was down 0.7% at the market close, while the Dow Jones Industrial Average (^DJI) slid more than 200 points, or 0.8%. The technology-heavy Nasdaq Composite (^IXIC) fell 0.46%.

In addition to raising the target range for its benchmark interest rate by 0.25%, the Fed left its options open for June, saying future rate hikes would be dependent on the impact of previous rate hikes on the economy.

In Wednesday's statement, the Fed said, "in determining the extent to which additional policy firming may be appropriate to return inflation to 2% over time, the committee will take into account the cumulative tightening of monetary policy, the lags with which monetary policy affects economic activity and inflation, and economic an financial developments."

In March, the central bank had said it "anticipates that some additional policy firming may be appropriate in order to attain a stance of monetary policy that is sufficiently restrictive to return inflation to 2 percent over time."

At a press conference following the decision, Fed Chair Jerome Powell called the change to the statement "meaningful," noting that "we’ll be driven by incoming data."

Stocks ticked up on the initial news but lost steam when Powell commented on the prospect of cutting rates.

“We on the committee have a view that inflation is going to come down not so quickly,” Powell said, adding that “if that forecast is broadly right, it will not be appropriate to cut rates.”

Prior to the Fed decision, analysts had said inflation remains sticky, the labor market is still hot but softening, and the economy is resilient. Plus, recent bank failures could set up the case for a pause in June, along with the Treasury Department's new projections adding more caution to the mix as lawmakers may have less than a month to reach a debt-ceiling deal.

On Wednesday, government bonds fell sharply. The yield on the 10-year note dipped down to 3.35% while the two-year note yield slipped to 3.85%. Oil prices tumbled — futures for West Texas Intermediate, the U.S. benchmark, dropped more than 4% to $68.22 a barrel.

Separately, hiring at private companies unexpectedly rose by 296,000 for April, above economists call for 148,000, according to payroll processing firm ADP. Other data out on Wednesday showed that ISM services PMI increased to 51.9 in April from 51.2 in March and slightly above economists estimates of 51.8.

Here are some of the trending tickers on Yahoo Finance:

• Ford Motor Company (F): The carmaker’s EV unit registered a $722 million quarterly loss. The automaker is nonetheless slashing the price of its all-electric Mustang Mach-E.

• CVS Health Corporation (CVS): The company posted a rise in sales during its first quarter as it closed its $10.6 billion deal for Oak Street Health’s 600 primary-care centers.

• Eli Lilly and Company (LLY): The pharmaceutical company announced positive results on its drug donanemab, which had significantly slowed the progression of Alzheimer’s disease symptoms.

• Starbucks Corporation (SBUX): The coffee giant posted second-quarter earnings and sales expectations and notched comparable-store sales growth in China.

• Icahn Enterprises L.P. (IEP): Billionaire Carl Icahn got the Hindenburg Research treatment. The short-selling research firm deemed the activist investor’s fund to be inflated by 75% or more.

• The Estée Lauder Companies Inc. (EL): The beauty brand forecasted a bigger drop in full-year sales and profit on Wednesday, hurt by a slowdown in China and reduced inventory levels by retailers in the U.S.

• Advanced Micro Devices, Inc. (AMD): The chipmaker reported a drop in margins and provided a forecast that didn’t give much indication for improvement.

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Dani Romero is a reporter for Yahoo Finance. Follow her on Twitter @daniromerotv

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