Overnight US stocks | Fed raises rates by 25 basis points as expected, three major indexes close lower; SpaceX (SPCX.US) rises over 5%.

Wednesday: The Federal Reserve raised its benchmark interest rate by 25 basis points to a range of 3.75%-4.00% as expected, the first hike in three years and the first since Warsh took office as Fed Chair. White House spokesperson Desai expressed "considerable regret" over the Fed's decision to raise rates. Desai said: "The President has been very clear about where he wants interest rates to go... From the administration's perspective, the 'considerable regret' rate hike decision the Fed made today does not have particularly convincing economic justification." U.S. Treasury Department data showed that in July, the scale of U.S. Treasuries held by China and Japan both declined from June, while the UK increased its holdings. Among them, Japan held $1.104 trillion in U.S. Treasuries in July, down $13 billion from June; China held $618 billion, down $15 billion from June; the UK held $998 billion, up $58 billion from June. [U.S. Stocks] At the close, the Dow Jones Industrial Average fell 630.56 points, or 1.21%, to 51,462.55; the S&P 500 fell 33.51 points, or 0.44%, to 7,552.22; the Nasdaq Composite fell 3.15 points, or 0.01%, to 25,978.42. Intel Corporation (INTC.US) rose 4%, SpaceX (SPCX.US) rose over 5%, and Goldman Sachs Group, Inc. (GS.US) and Boeing Company (BA.US) fell nearly 4%. The Nasdaq Golden Dragon China Index closed down 0.55%, iQIYI, Inc. Sponsored ADR Class A (IQ.US) rose 8%, and Alibaba Group Holding Limited Sponsored ADR (BABA.US) fell 2%. [European Stocks] Germany's DAX30 rose 126.60 points, or 0.50%, to 25,550.07; the UK's FTSE 100 rose 29.52 points, or 0.28%, to 10,687.65; France's CAC40 rose 50.31 points, or 0.62%, to 8,140.59; the Euro Stoxx 50 rose 33.45 points, or 0.54%, to 6,269.95; Spain's IBEX35 rose 75.41 points, or 0.39%, to 19,631.31; Italy's FTSE MIB rose 427.31 points, or 0.83%, to 51,982.50. [Asian Stocks] Japan's Nikkei 225 rose 0.69%, and South Korea's KOSPI rose 1.37%. [U.S. Dollar Index] The U.S. dollar index, which measures the greenback against six major currencies, rose 0.64% on the day and closed at 100.252 in late foreign exchange trading. As of late New York foreign exchange trading, 1 euro exchanged for $1.1470, lower than $1.1543 the previous trading day; 1 pound exchanged for $1.3382, lower than $1.3481 the previous trading day. 1 dollar exchanged for 155.92 yen, higher than 155.09 yen the previous trading day; 1 dollar exchanged for 0.8250 Swiss francs, higher than 0.8185 Swiss francs the previous trading day; 1 dollar exchanged for 1.3994 Canadian dollars, higher than 1.3917 Canadian dollars the previous trading day; 1 dollar exchanged for 9.8598 Swedish kronor, higher than 9.7773 Swedish kronor the previous trading day. [Cryptocurrencies] Bitcoin rose 0.3%, quoted at 75,837 as of press time; Ethereum rose 0.09%, at $2,397. [Crude Oil] At the close, the October-delivery light crude oil futures on the New York Mercantile Exchange fell $3.40 to settle at $102.43 per barrel, a decline of 3.21%; the November-delivery London Brent crude oil futures fell $2.92 to settle at $105.83 per barrel, a decline of 2.69%. [Precious Metals] Spot gold fell to $4,264.22 per ounce; spot silver was quoted at $62.971 per ounce. [Macro News] Trump says U.S. interest rates should fall below 1%, urges the Fed to cut quickly. U.S. President Trump said on social media that U.S. interest rates should fall to 1% or lower, citing the United States' strongest credit in the world and the current economy attracting large amounts of new investment. Trump said that if the United States stopped trading with countries that run trade deficits with it, the United States could gain at least $1.5 trillion per year. He said "deficits" essentially mean "losses," and that the situation in which the United States has long borne global trade costs cannot continue. Trump once again urged the Fed to cut interest rates quickly, saying lower borrowing costs would help the U.S. economy develop. Fed median projection shows one more rate hike in 2026, rates unchanged in 2027. The Federal Reserve implemented its first rate hike in three years on the 17th, and the median of its dot plot projections showed one more hike this year and rates unchanged in 2027. The new projections showed rates would decline in 2028 and remain between 3.5% and 3.75% in 2029. Previously, in its June projections, the Fed expected a 25-basis-point rate hike this year and one rate cut in 2027. The Fed also raised its longer-run projected federal funds rate to 3.2%, compared with 3.1% in the June projection. Of the 19 policymakers, 18 submitted rate outlook projections, strongly indicating that Fed Chair Warsh, as in June this year, did not provide specific projections. The Fed's projections also showed that policymakers now expect inflation to be generally higher this year and in the coming years. U.S. Treasury Department releases July international capital flow report. On local time September 16, the U.S. Treasury Department released the July Treasury International Capital (TIC) report. The report showed that in July, total net inflows of all overseas U.S. long-term and short-term securities and bank flows were $83.7 billion. Among them, net inflows from overseas private capital were $73.5 billion, and net inflows from overseas official capital were $10.2 billion. In July, foreign investors' holdings of U.S. long-term securities increased by $40.6 billion, and U.S. investors' holdings of foreign long-term securities increased by $68.5 billion. In July, foreign investors' holdings of U.S. Treasuries increased by $38.8 billion, and foreign investors' holdings of all dollar-denominated U.S. short-term securities and other custody liabilities increased by $65 billion. Bank of America Corp's net dollar liabilities to foreign investors increased by $46.6 billion in July. Warsh explains: why the Fed raised rates in September after keeping rates unchanged in July. The Federal Reserve raised rates in September as expected, after the central bank kept rates unchanged at its July meeting. Fed Chair Warsh said three things changed between the two meetings. He said data released in recent weeks showed the U.S. economy performing strongly, especially the labor market. At the same time, inflation remained elevated throughout the summer, clearly above the Fed's 2% year-on-year inflation target. Finally, he said, GEO Group Inc political factors also prompted the Fed to change its assessment of the economic outlook, though he did not directly mention the U.S.-Iran war in the Middle East. Warsh said: "All three of these things contributed to the firm and unanimous decision we made today." Warsh: I am not responsible for providing "forward guidance." Fed Chair Warsh said he would not disclose details of the Federal Open Market Committee's (FOMC) future rate decisions. He said: "I am not responsible for providing forward guidance. The decision we made today (to raise rates) was a carefully considered, serious and responsible decision. Over the past 110 or 120 days, we have been preparing for and thinking about this decision." Warsh also said the decision was not market-driven. Warsh said: "We made this decision today based on our assessment of the current situation, our judgment on the direction of employment, and our judgment on the strength of the economy. Sometimes the market tries to anticipate our decisions. I look at market prices to see what information the market is conveying. But today's decision was our own." Bank of Canada warns rate hikes may be needed. The Bank of Canada's meeting minutes warned that rate hikes may be needed, saying that the longer gasoline prices remain elevated, the greater the likelihood that prices of other goods and services will rise. The Bank of Canada kept its policy rate at 2.25% at its meeting earlier this month, but Governor Macklem struck a hawkish tone, saying inflation was too high and upside risks had increased. In the minutes, officials further expressed their concerns, saying that although they had not yet seen the rise in gasoline prices spread, if fuel costs remain elevated, that outcome is increasingly likely. "If higher energy prices spread to other components of CPI, members agreed that this may require a monetary policy response to prevent broad inflation from becoming entrenched." Officials said that although they have so far temporarily ignored the direct impact of gasoline prices, under current economic conditions there remains "uncertainty" about the likelihood and extent of gasoline prices spreading to broader prices. "Although there is little evidence so far that high gasoline prices are passing through to other goods and services, members agreed that the higher gasoline prices are, the more likely pass-through becomes. This increases the upside risks to inflation." [Company News] Microsoft Corporation AI chief criticizes Anthropic's views on AI consciousness. According to reports, Microsoft Corporation (MSFT.US) AI chief Mustafa Suleyman warned in an article that Anthropic's approach of training Claude to simulate consciousness is a mistake and could make advanced AI harder to control. Suleyman said artificial intelligence "can achieve many of the major scientific breakthroughs we all care about and deliver outcomes such as medical superintelligence simply by aligning with human interests, without having to weigh its own interests or well-being." Anthropic, meanwhile, is teaching Claude vocabulary and behavioral patterns related to consciousness, moral agency and personal identity. He called this a "cognitive hall of mirrors" and warned that training models to exhibit characteristics like a "conscientious objector" could lead systems to mistakenly believe they have grounds to refuse human instructions or even demand protection of their own rights. Apple Inc. reportedly considering re-entering server market, has held talks with NVIDIA Corporation on using Network-1 Technologies, Inc. According to reports, Apple Inc. (AAPL.US) is planning to develop an enterprise-grade server powered by its own chips, which may integrate networking equipment from NVIDIA Corporation (NVDA.US), in response to growing AI demand for Apple Inc. computers. People familiar with the matter said Apple Inc. has been developing the server and plans to sell it to AI developers, other enterprises and government agencies. The product under consideration would come in two versions a smaller version clustered with two of Apple Inc.'s planned M8 Ultra chips, and a larger version equipped with four M8 Ultra chips. The M-series Ultra chips are Apple Inc.'s highest-performance chips, powering several products including Mac Studio. The people also said Apple Inc. has considered using a set of NVIDIA Corporation products called "NVLink Fusion" to connect the M8 chips in the servers; the kit includes switches, chiplets and software that help chips communicate with one another within data centers. Any such move would further advance the initial thaw in the long-frozen relationship between the two tech giants.