Dow Jones drops 470 points as market faces rate hike fallout

Dec. 20 (UPI) -- Stocks were down Thursday as the market reacted to fallout from the Federal Reserve's interest rate hike and concerns over a potential government shutdown.

The Dow Jones Industrial Average closed down 464.40 points, or 1.99 percent to 22,859.26 after being down by as many as 679 points earlier in the day. The S&P 500 also dropped 1.79 percent, while the Nasdaq Composite slipped 1.63 percent to enter bear market territory.

Continuing a down month of December, Thursday's trading brought the Dow's two-day declines to more than 800 points and its 5-day losses to more than 1,700 points.

Investors abandoned groups of risky stocks including Twitter, which plummeted 11 percent, JCPenny, which dropped 6 percent, and Tesla, which dropped 5 percent.

Apple and Amazon also both declined by about 2 percent on Thursday.

Trading began on a sour note after the Fed's decision Wednesday to raise its benchmark interest rate one-quarter point, to 2.5 percent.

Fears of a rate increase, which came as some economists predict a softening economy and a global recession in 2019, also contributed to a more than 500-point drop in the Dow earlier in the week.

Thursday brought more troubling news, as stocks hit a low for the day after House Speaker Paul Ryan said President Donald Trump wouldn't sign a stopgap spending bill to fund portions of the government until Feb. 8 because it doesn't include enough funding for border security.

Amid the recent news and several months of poor performance by the stock market, the VIX volatility index reached 28.38, its highest mark since February when the Dow experienced two 1,000-point losses in a week.