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US: Stocks post a split finish as Federal Reserve delivers a rate cut
[NEW YORK] The benchmark Dow Jones Industrial Average erased a 200-point drop on Wednesday, leading Wall Street to a split finish as the Federal Reserve delivered another interest rate cut.
As expected, the Fed cut interest rates by a quarter of a percentage point but cast some doubt on the need for future stimulus, highlighting recent signs of strength in the economy.
But in addressing reporters, Fed Chairman Jerome Powell later reiterated that the central bank was poised to lower rates further if the economy began to weaken.
After spending most of the day in the red, the Dow posted a modest 0.1 per cent gain, closing at 27,147.12.
The S&P 500 ended flat at 3,006.71 and, while also well off the session's low point, the tech-heavy Nasdaq was 0.1 per cent lower at 8,177.39.
"The market sold off on the fact that the Fed did what they were expected to do and no more," Peter Cardillo of Spartan Capital told AFP.
"Powell handled himself very well during the Q&A. He was very consistent. The market is relieved at that."
But, after a two-day meeting, the Fed's concluding statement showed mounting divisions among policymakers, with one member favoring an even deeper cut and two opposing any decrease at all.
Among individual companies, FedEx posted its worst day since the financial crisis, plunging 12.9 per cent after cutting its earnings guidance on a weaker global outlook and trade fears.