Wall Street falls as Fed moves cautiously

Reuters News
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Posted: May 29, 2012 4:31 AM
By Ryan VlastelicaNEW YORK (Reuters) - Stocks fell on Wednesday after the Federal Reserve voted to extend a program to stimulate the economy, but investors were disappointed the Fed did not offer any clues on further easing.Trading was volatile after the Fed announcement, with the market oscillating between losses and gains before selling accelerated during Fed Chairman Ben Bernanke's afternoon news conference.The Fed said it will extend until the end of 2012 Operation Twist, a stimulative program aimed at lowering long-term interest rates by swapping $267 billion in U.S. Treasury securities. The program had been scheduled to end this month.The benchmark S&P 500 index had risen for four days in a row and accumulated gains of about 7 percent from a five-month low hit earlier in June as many investors anticipated some Fed action to aid the flagging recovery.While the Fed is "willing to take action if needed, they're not giving enough detail as the market wants. There's a disconnect between what markets want and what the Fed is willing to commit to," said Alec Young, global equity strategist at S&P Equity Research in New York.The Dow Jones industrial average was down 87.41 points, or 0.68 percent, at 12,749.92. The Standard & Poor's 500 Index was down 10.55 points, or 0.78 percent, at 1,347.43. The Nasdaq Composite Index was down 15.65 points, or 0.53 percent, at 2,914.11.Procter & Gamble shares fell 3.3 percent to $60.17 after the world's largest household product maker cut its growth forecasts.Adobe Systems slid 3.1 percent to $31.86 after the maker of Photoshop and Acrobat software cut its full-year revenue outlook and warned about weak demand in Europe.(Editing by Kenneth Barry)