Shares of fintech stocks Upstart Holdings (NASDAQ: UPST), SoFi Technologies (NASDAQ: SOFI), and Affirm Holdings (NASDAQ: AFRM) all plunged on Friday, down 6.4%, 5.9%, and 7.5%, respectively, as of 2:41 p.m. ET.

With the consumer price index in August coming in slightly higher than expected, investors are convinced the Federal Reserve will raise interest rates potentially even higher than thought just a week ago. Meanwhile, last night's ominous warning from FedEx (NYSE: FDX) is stirring recession fears.

The combination suggests markets are very fearful the Federal Reserve will "overdo it," and tighten interest rates into an already weakening economy. That wouldn't be a good scenario for any company involved in lending, and especially newer, unprofitable fintech stocks that have yet to prove themselves in a recessionary environment.

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Source Fool.com