(Updates with index/price moves and Fed/company/geopolitical news from the first paragraph.)

US equity indexes fell amid expectations of a tightening bias from the Federal Reserve and as Iran's surprise missile attack on regional neighbors escalated war tensions ahead of big-tech quarterly results post-bell.

The Dow Jones Industrial Average slumped 1.6% to 51,891.2, with the Nasdaq Composite down 1.2% to 24,587.5 and the S&P 500 lower by 0.9% to 7,366.5.

Microsoft (MSFT), Meta Platforms (META), Lam Research (LRCX), Arm (ARM), and Qualcomm (QCOM) will report earnings after the bell on Wednesday, and investors will focus on what these companies will say about capital expenditures related to artificial intelligence and the state of free cash flows.

Among companies with a market capitalization of more than $200 billion, eight of the 10 worst intraday performers were from the technology sector, according to data compiled by Finviz. VanEck Semiconductor ETF (SMH), with net assets of $77.2 billion, slumped 3.1% after midday.

The Fed is likely to remain on hold in the 3.5% to 3.75% target range in July, according to the CME FedWatch tool. However, the probability that the target rate for fed funds will increase to 4.25%-4.5% in December jumped to 17% as of Wednesday afternoon from 9% a month ago, implying a significant tightening bias among some market participants.

In geopolitical news, President Donald Trump said Iran will be hit hard, according to Fox News.

The US Central Command said it joined Saudi Arabian Armed Forces to conduct strikes in Iraq against Iran-aligned terrorists that the Islamic Revolutionary Guard Corps directed to attack US forces and Saudi energy infrastructure.

The front-month US West Texas Intermediate jumped 7.2% to $84.93 a barrel, and global benchmark North Sea Brent surged 7.8% to $90.65 a barrel.