Traders work on the floor of the New York Stock Exchange during afternoon trading on September 13, 2022 in New York City.
Michael M. Santiago | Getty Images News | Getty Images
Stock fell on Monday after the major averages' capped their worst week since June and interest rates surged ahead of the Federal Reserve's two-day meeting this week.
The Dow Jones Industrial Average fell 180 points, or 0.6%. The S&P 500 and Nasdaq Composite slid 0.6%, respectively.
The 10-year Treasury yield topped 3.51% on Monday, its highest level in 11 years, and rates across the board continued to rise ahead of the Fed's likely decision to raise its benchmark rate by another three-quarters of a point to snuff out inflation. After some brief hope over the summer that the Fed may be done with its aggressive tightening campaign soon, investors have begun dumping stocks on fears the central bank will go too far and tip the economy into a recession.
Investors are coming into the new week focused on the Fed's latest policy meeting, which will begin Tuesday. The central bank is expected to raise interest rates by another three-quarters of a point, though investors are also watching for guidance about corporate earnings before the next reporting season begins in October.
"As we peer into the end of 2022, we continue to anticipate choppy conditions in US equities, which we view as caught in a tug of war between deeply bearish sentiment (a contrarian / bullish signal) and ongoing concerns about further Fed tightening and its longer-term economic ramifications and downward earnings revisions," wrote RBC Capital Markets' Lori Calvasina in a note to clients Monday.
Nine of the 11 major S&P 500 sectors dipped into negative territory, led to the downside by energy.
Stocks slid last week as investors reacted to a hotter-than-expected inflation report and a dismal warning from FedEx about a "significantly worsened" global economy. The major averages posted their fourth weekly loss in five weeks and hovered near two-month lows.
Beyond the Fed meeting, there are just a few economic data releases on deck this week, including August housing starts on Tuesday and initial jobless claims on Thursday.
A handful of corporate earnings are also on deck, including Costco, Darden Restaurants, General Mills and Lennar.
—CNBC's Patti Domm contributed reporting.
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Dow falls 200 points as rates continue march higher ahead of Fed meeting this week - CNBC
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