Wall Street sinks after Fed gives mixed signals on next move

REUTERS: Wall Street sank on Wednesday when Federal Reserve policy makers gave mixed signals about their next move after cutting interest rates by a quarter of a percentage point in a widely expected move.

"The main concern is there might not be another cut, and that's why you had a little bit of a selloff," said Alan Lancz, President of Alan B. Lancz and Associates in Toledo, Ohio."But it's almost like selling on good news. They left the door open for more cuts. It's a really divided Fed right now." At 2:21 pm ET, the Dow Jones Industrial Average was down 0.63per cent at 26,940.15 points, while the S&P 500 lost 0.72per cent to 2,984.16.Ahead of the Fed's announcement, the S&P 500 had been down about 0.3per cent.

The central bank also widened the gap between the interest it pays banks on excess reserves and the top of its policy rate range, a step taken to smooth out problems in money markets that prompted a market intervention by the New York Fed this week.FedEx shares tumbled 13.9per cent and were on course for their sharpest one-day percentage drop since the financial crisis after the company blamed U.S.-China trade tensions and a split with Amazon.com Inc for its dismal full-year profit forecast.

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