Stock market today: Dow drops 570 points to end worst month of 2024 as traders brace for Fed decision

Stocks plunged as markets adjusted to another hot economic data point right as the Fed gets ready to deliver its next policy decision.

• Stocks dropped sharply as investors readjusted rate cut expectations ahead of the latest FOMC meeting.
• The latest labor cost data added to fears of a hot economy and sticky inflation. 
• The stock decline only deepens April's losses, snapping a five-month streak of gains. 

US stocks plunged on Tuesday as investors got another dose of inflationary data ahead of the Federal Reserve's next policy decision. 

The benchmark S&P 500 index dropped over 1%, after quarterly labor costs came in hotter than expected. The Employee Cost Index, a measure of wages and benefits, rose 1.2% against 1% consensus, the Bureau of Labor Statistics reported.

For the Fed, that adds even more restraint on its ability to cut interest rates this year, and futures markets now expect only one rate cut in December. Investors will tune in to Fed commentary after its FOMC meeting wraps up on Wednesday. 

"The policy statement and Chair Powell's comments in the press conference will reiterate the Fed's resolve to get inflation back to their 2% target. Barring a major crisis, a rate cut looks off the table before September, and even that is less likely than it seemed a few weeks ago given recent data demonstrating a broad-based increase in prices of services, houses, and labor costs in early 2024," Bill Adams, chief economist for Comerica Bank, said in written commentary.

The equity decline that followed only deepened April's market losses, making it the first month of 2024 to end in the red. Its 3.7% decline snapped a bull run that's extended since November.

Meanwhile, shares in McDonald's dropped as much as 3.8%, after its earnings report missed estimates. Amazon will publish its quarterly results after Tuesday's closing bell.

Among other notable movers, ceasefire talks between Israel and Hamas sent Brent crude falling 2.6% throughout the day. 

Here's where US indexes stood at the 4:00 p.m. closing bell on Tuesday: 

• S&P 500: 5,035.69, down 1.57%
• Dow Jones Industrial Average: 37,815.92, down 1.49% (-570.17 points)
• Nasdaq Composite: 15,657.82, down 2.04%

Here's what else is going on today: 

• Investors should 'be like Buffett' and buy Apple while the stock is cheap, Bernstein said in a note.
• Trump Media's battle against short sellers has coincided with big market gains.
• If sentenced, Binance founder Changpeng Zhao could be the richest US inmate ever.
• Bitcoin's bull rally may have come to its end, and could drop 50%, market vet predicts.
• A rollout of Tesla's self-driving tech in China could earn over $2 billion by 2030, Bank of America says.

In commodities, bonds, and crypto: 

• Oil prices fell. West Texas Intermediate crude oil shed 1.09% to $81.92 a barrel. Brent crude, the international benchmark, dropped 2.6% to $86.14 a barrel. 
• Gold slumped by 1.85% to $2,295.4 per ounce. 
• The 10-year Treasury yield jumped seven basis points to 4.684%. 
• Bitcoin decreased by 5.4% to $60,358.