By Karen BrettellJuly 29 (Reuters) - U.S. stocks extended losses, interest-rate sensitive two-year Treasury yields dropped and the dollar slipped on Wednesday after the Federal Reserve held interest rates steady, while oil prices surged following renewed attacks across the Middle East. Oil prices were up roughly 8% after major airstrikes resumed in the Middle East, raising the specter of further disruptions to already impaired global energy supplies. The rebound in oil prices had raised expectations that the U.S. central bank could hike rates this week, even though inflation moderated in June more than economists had ‌expected. Fed funds futures traders are now pricing in 60% odds of a rate hike in September. The dollar index, which measures the greenback against a basket of currencies including the yen and the euro, fell 0.45% to 100.96, with the euro up 0.54% at $1.1447.