What happened

Shares of Marriott International (MAR 1.95%) fell 5.6% on Wednesday, closing at $148.17. They closed at the low point of the day as the stock dropped precipitously in the afternoon, along with the overall market.

The major indexes were all up in the morning in anticipation of the announcement by the Federal Reserve Board on interest rates, but after that announcement came, the indexes all plummeted. The Dow Jones Industrial Average finished the day down 522 points (1.7%), while the S&P 500 dropped 66 points (1.7%), and the Nasdaq dropped 205 points (1.8%).

So what

The Federal Reserve Board meeting was the big news of the day and the board, as expected, raised interest rates by 75 basis points for the third straight time. The benchmark rate is now in the 3% to 3.25% range. This is the highest rates have been since 2008.

Federal Reserve Board Chair Jerome Powell gave no indication that the rate hikes are over, saying the Fed is "strongly resolved" to bring down inflation. "We have got to get inflation behind us," Powell said during a news conference Wednesday. "I wish there were a painless way to do that. There isn't."

The Fed projected a median rate of 4.4% by the end of 2022, with more hikes in 2023 expected. Gross domestic product (GDP) growth is now expected to be just 0.2%, according to the Fed's median projections, down from 1.7% GDP projections in June. Next year, the GDP is expected to rise 1.2%, according to Fed estimates.

Now what

Stocks in the hotel and hospitality industries, including Marriott, were among the hardest hit. 

With rates continuing to rise into next year and the economy projected to slow to a crawl by the end of the year, that would likely have an impact on discretionary spending and businesses in the travel industry. Marriott expects its revenue per available room (RevPAR) to be down 3% to flat in North America at the end of fiscal year 2022.