U.S. stocks end down despite rate cut

Calcutta News.Net
Wednesday 30th January, 2008

U.S. stocks rallied Wednesday on news the Federal Reserve was slashing interest rates by another 50 basis points to 3%.

Prior to the announcement around 2:15pm stocks were struggling to get a footing, with all indices dipping into negative territory.

The Fed announcement however turned the trend positive and within minutes all indices had tracked to the black.

The rally was short-lived however as stocks began falling again in the last minutes of trading.

At the close the Dow Jones Industrials were down 37.47 points or 0.30% at 12,442.83, more than 200 points off the highs that followed the Fed announcement.

The Nasdaq Composite was down 9.06 points or 0.38% at 2,349.00.

The Standard and Poor's 500 was off 6.56 points or 0.48% at 1,355.81.

"The Fed understands that it needs to make hay while the sun shines by pumping as much liquidity into the economy now, while it still can, before the public's inflation expectations catch up with reality," John Kosar, president of Asbury Research in Chicago told Reuters newsagency.

The U.S. dollar plummeted following the Fed move. Around the close of trading in New York gains however were being slimmed back. The euro was quoted at 1.4878, and the British pound at 1.9909. The Swiss franc was changing hands at 1.0833.

The Japanese yen strengthened to 106.53, while the Australian dollar rallied to .8969.

The Canadian dollar was at 0.9921.

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