If only Wall Street would realize,
you can't always get what you want.
A day after the
Federal Open Market Committee lowered interest rates by a half-percentage point -- as opposed to a more aggressive cut of 75 basis points -- investors were still stomping their feet in protest.
Dow Jones Industrial Average sold off sharply at the open and had rebounded to less significant losses. The
Nasdaq Composite Index was treading higher. The broader
S&P 500 index was hear flat. Both the Nasdaq and S&P 500 are mired in bear-market territory, meaning they're more than 20% off their all-time highs.
Federal Reserve lowered the
federal funds rates -- the interest rate at which banks lend money to each other overnight -- to 5%. This is the third time since the beginning of the year the Fed has lowered rates to spur increased borrowing and demand in the economy. But for stock market investors, the rate cut wasn't enough.
In its language, the Fed left open the possibility of another cut before its next official meeting on May 15. The
federal funds futures contract -- a good proxy of the expected direction of interest rates -- is now pricing in a 100% chance the Fed will cut before May 1. But some think the Fed is behind the curve fixing a broken economy and that its statement just confused matters.
"The Fed attempted to be soothing with its words," said Tony Crescenzi, chief bond market strategist at
. "But it just created uncertainty about whether or not there will be an intermeeting cut."
Investors weren't pleased with February's
Consumer Price Index, released at before the opening bell this morning. The headline and core number that excludes volatile food and energy prices both came in a little higher than expected at 0.3% --versus
consensus forecasts of 0.2%. Still, the headline number was only half of January's surprising 0.6% jump, which sparked fears of stagflation -- the double whammy of rising prices in a slowing economy.
Today's numbers may cause people to worry that inflation remains a concern, which could deter the Fed from more aggressive monetary policy. The CPI measures the change in cost of a representative basket of goods and services, such as food, energy, housing, clothing, transportation, medical care, entertainment and education.
The well of corporate news, of course, continues to deliver. And investors are listening carefully to what companies are saying. Electronics manufacturer
was up 7.3% to $19.45 after it issued some mixed news. The company posted second-quarter earnings of 21 cents a share, beating Wall Street estimates by a penny. But it also announced an undisclosed number of job cuts and lowered its outlook for the next two quarters.
was gaining 6.7% to $32.50 after it said it will have to revise its financial statements for the third quarter of 2000.
Procter & Gamble
was losing 1% to $65.20 on reports it may be
cutting up to 20% of its workforce.
Brokerage stocks are active today.
Morgan Stanley Dean Witter
was off 0.6% to $56.20 after it said its first-quarter
profit dropped 30% from the year-ago level, as a slump in stock market activity weighed on trading commissions and underwriting income.
was dipping 0.2% to $65.80 after it posted first-quarter results today that
slightly exceeded Wall Street estimates, even as profits dropped nearly 28% from the year-ago period. And profits at