Stock market today: Dow, S&P 500, Nasdaq slide as Fed-fueled rally falters

European stocks fell across the board after European Central Bank President Christine Lagarde stated that a 25% tariff on goods imported to the US could raise inflation and lower growth in the bloc.

“In the near term, EU retaliatory measures and a weaker euro exchange rate…could lift inflation by around half a percentage point,” Lagarde told European lawmakers, per Reuters. “The effect would ease in the medium term due to lower economic activity dampening inflationary pressures.”

The pan-European Stoxx 600 (^STOXX) fell 0.7%, while Germany’s DAX (^GDAXI) dropped 1.5%. The CAC (^FCHI) in Paris was 1% lower.

And in London, the benchmark index (^FTSE) was roughly flat as traders awaited the next interest rate decision from the Bank of England, which is expected to hold rates steady.