Wall Street suffered another downturn on Thursday, reacting to the Federal Reserve's benchmark rate hike and more concerns about regional banks.

The Dow Jones Industrial Average fell 286.50 points (0.86%) at the closing bell. The S&P 500 (-0.72%) and the Nasdaq Composite (-0.49%) also sustained losses during a troublesome economic cycle.

The losses reflect investor concerns over the Fed's heavy handed approach to fighting inflation. Wednesday's 0.25% increase was the 10th of the current cycle and raises the benchmark rate (5% to 5.25%) to its highest level since 2007.

Investors are also closely watching for signs of contagion in the banking system. Following the recent collapse of First Republic Bank and other last month, PacWest is the latest regional bank on the ropes. It's stock sank by 50% on Thursday.

Also weighing heavily on investors is the looming debt ceiling crisis. President Joe Biden is scheduled to meet with House Speaker Kevin McCarthy next week to discuss ways to avert a default and a possible economic catastrophe.