NEW YORK - Wall Street received the interest rate cut it wanted, but still turned in a baffling late-day performance Wednesday, shooting higher and then skidding lower in the last minutes of trading as some investors rushed to cash in profits after the market's big advance. The major indexes ended the day mixed, with the Dow Jones falling 74 points.
"It was a panic sell in the last two minutes," said Dave Rovelli, managing director of U.S. equity trading at Canaccord Adams in New York, referring to reports that General Electric was aiming at 2009 profits to be little changed from 2008. The reports were subsequently called into question, and a GE spokesman said the statements were taken out of context.
The market waffled while it was still digesting the Fed's economic assessment statement that accompanied the rate cut, but then advanced for most of the final hour of trading, and until shortly before the close, it looked like Wall Street would extend its huge rally from Tuesday, which sent the Dow Jones industrials shooting up nearly 900 points.
Bruce McCain, chief investment strategist at Key Private Bank in Cleveland, said the Fed's overall tone conveyed it regards the economic troubles as somewhat typical of a weak economy and not the kind of intractable problems that signal a deep recession is imminent.
"They more or less indicated elevated concerns about the economy, but nothing in it suggests any real panic."
But the last hour of trading on Wall Street over the past month has seen turnarounds in sentiment as well as prices, and the late-session volatility that has become the norm was in force again Wednesday.
Dow 30 Industrials S&P 500 NASDAQ Russell 2000 Wilshire 5000 Gold Oil per
barrel Dollar vs. Canada Dollar vs. euro ' 82.97
11,615.93 m ' 7.10
1,292.93 m ' 25.05
2,453.67 m ' 6.69
754.38 m ' 82.70
13,228.23 m - $16.80
$808.20 n - $0.99
$115.01 n ' 0.0006
1.0632 m ' 0.0055