US stocks fall amid mixed Fed signals on more rate cuts

Aug 01, 2019: Wall Street stocks fell Wednesday after the Federal Reserve cut interest rates but offered mixed signs on what the move meant for future monetary policy.

Near 1945 GMT, the Dow Jones Industrial Average was at 26,956.14, down 0.9 percent.

The broad-based S&P 500 dropped 0.8 percent to 2,990.53, while the tech-rich Nasdaq Composite Index also slid 0.8 percent to 8,205.02.

Stocks had initially edged lower after the Fed announced at 1800 GMT that it planned a 25 basis point interest rate cut.

But stocks fell sharply midway through a subsequent news conference after Fed Chairman Jerome Powell said the US central bank did not expect a "lengthy cutting cycle." But Powell then went on to say the Fed was not committed to a single cut.

"Let me be clear. I said it's not the beginning of a long series of rate cuts. I didn't say it's just one or anything like that," Powell said.

The rate cut was the Fed's first in more than a decade, meeting market expectations but not going with the larger 50-basis-point cut that some traders expected. The dollar rose against both the euro and the pound.

Expectations for a Fed rate cut have given a boost to US stocks since early June when Powell signaled a shift towards a more dovish stance, citing worries about trade war uncertainty and slowing global growth.

AFP/APP