"As expected" from the Fed proved insufficient for financial markets Wednesday. Already fading from earlier highs before the Federal Open Market Committee's announcement at 2:15 p.m. EDT, stocks and, especially, Treasuries swooned immediately in the wake of the central bank's decision to cut the fed funds rate by 25 basis points. "Recent signs point to a firming in spending, markedly improved financial conditions, and labor and product markets that are stabilizing," the FOMC said in its policy statement . "The economy, nonetheless, has yet to exhibit sustainable growth. With inflationary expectations subdued, the Committee judged that a slightly more expansive monetary policy would add further support for an economy which it expects to improve over time." The immediate reaction to the announcement suggested some traders were hoping for more aggressive action from the Fed. Notably, a slight majority of primary bond dealers were looking for a 50-basis-point cut and equity traders seemingly always want more from the Fed, regardless of its recently spotty track record. After trading as high as 9161.74 midmorning, the Dow Jones Industrial Average fell sharply after the Fed's announcement, closing down 1.1% to 9011.53. Following similar patterns, the S&P 500 shed 0.8% to 975.31 vs. its early high of 991.64 while the Nasdaq Composite closed down 0.2% to 1602.63 after trading as high as 1630. What was troubling from a technical perspective was that Wednesday was a reversal day, in which major averages established higher highs than the prior session but finished at lower lows. Still, trading volumes were subdued and the mood among many equity traders was the Fed announcement was a "nonevent." Conversely, there was no denying the effect of the Fed's decision on the Treasury market. The price of the benchmark 10-year Treasury fell 1 9/32 to 101 28/32, its yield jumping to 3.40%. The price of the two-year note, which most closely tracks the fed funds rate, fell 11/32 to 99 30/32, its yield rising to 1.27%.