US stock pessimism looks set to last another week

STOCKS slid last week as traders saw the dark lining in the Federal Reserve's silver cloud, and that pessimism looks set to last at least another week.

When Fed chairwoman Janet Yellen's rate-setting committee decided not to hike interest rates, they did so to avoid unsettling markets that have already endured weeks of extreme volatility. The decision and the unusual explanation did the very opposite, unleashing one of the biggest selloffs in September last Friday, in a month that has seen several so far.

The phrase that caused the consternation was: "(The rate-setting) committee continues to see the risks to the outlook for economic activity and the labour market as nearly balanced but is monitoring developments abroad."