A still-anxious Wall Street closed lower Wednesday, sacrificing the advance it made after the Federal Reserve cut interest rates half a...
NEW YORK — A still-anxious Wall Street closed lower Wednesday, sacrificing the advance it made after the Federal Reserve cut interest rates half a percentage point. Investors collected profits after nearly three sessions of big gains, unwilling to leave money on the table amid continuing economic uncertainty.
The Dow Jones industrial average, up as much as 200 points after the Fed’s rate announcement, closed the session down 37.47 at 12,442.83.
Microsoft, one of the 30 Dow stocks, fell 40 cents to close at $32.20 a share. Boeing, also a Dow stock, soared $1.91 to $82.87 after reporting good fourth-quarter results.
Along with the Dow, broader indexes also slipped. The Standard & Poor’s 500 index fell 6.49 to 1,335.81, and the Nasdaq composite declined 9.06 to 2,349.00.
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It wasn’t surprising that the market pulled back, having suffered months of losses and having driven the Dow up more than 470 points so far this week ahead of the late-day downturn.
Anthony Conroy, managing director and head trader for BNY ConvergEx Group, said expectations of more downgrades of bond insurers such as Ambac Financial Group and MBIA — as well as uneasiness ahead of today’s Commerce Department report on personal income and spending inflation — was enough to spur people to cash in profits from the market’s initial gains.
Key reports on the job market and manufacturing set to arrive Friday could add to investors’ concerns about the state of the economy, which has been dragged down by a crumbling housing market and losses at major financial institutions.
“Volatility is here to stay,” Conroy said. “People who think these issues will go away overnight in one Fed rate cut are mistaken.”
Scott Fullman, director of investment strategy for I.A. Englander & Co., said it was unlikely the downturn was the result of disappointment over the rate cut or the Fed’s accompanying statement. “We’re seeing profit-taking ahead of the employment report on Friday,” he said. “The market has had a really nice run-up this week, and investors are taking advantage of that.”