Despite a surprise cut in the Federal funds rate Tuesday morning, stocks tumbled at the bell, with the Dow Jones Industrial Average losing more than 400 points. The S&P 500 fell more than 3 percent in early trading to 1,283.96, while the S&P Retail Index plunged 3.4 percent to 361.82.
The Federal Reserve slashed the benchmark discount rate by 75 basis points to 3.5 percent, but investors continued to pull back on fears of a recession, following the similar reaction by overseas markets in Asia and Europe. The cut in the discount rate, or the interest the Fed charges to lend funds to banks, came a week earlier than the central bank’s regularly scheduled meeting.
For complete coverage, see Wednesday’s WWD.