When it comes to communicating the Federal Reserve's thinking to the markets, Richard Fisher is starting to demonstrate a willingness to put it pretty plainly.

About two hours remained in the trading day when the Dallas Fed president offered hawkish comments that spread through trading circles and appeared to spark a selloff that ended only when the closing bell rang.

With his statement all but confirming that the Fed would keep lifting rates, stocks essentially lost any chance they had to take advantage of plunging crude oil prices. The Dow Jones Industrial Average treaded water for much of the session, but ended down 94.37 points, or 0.9%, to close at 10,441.11, with most of the loss coming after Fisher's speech.

Exxon Mobil ( XOM) was the biggest loser on the Dow, falling 3.1%. Energy stocks were hit not only by sliding crude prices but by a profit warning from BP ( BP). The big oil company said hurricanes Rita and Katrina have hurt production and will cut into its profits.

The S&P 500, which contains a number of energy companies, finished down 12.23 points, or 1%, at 1214.47.

Even the tech-heavy Nasdaq Composite couldn't escape the downward trend, losing 16.07 points, or 0.8%, to 2139.36.

Microsoft ( MSFT) fell on news that Google ( GOOG) and Sun Microsystems ( SUNW) will deliver a new product to competes with the software giant's Office and Outlook programs.

Separately, a downgrade of Texas Instruments ( TXN) weighed on the chip sector.

That the Fed is concerned about inflation and intends to continue raising rates should hardly be surprising to anyone anymore. But it could be that when the warning comes from Fisher -- the same fellow who said back in June that the Fed's rate-hike campaign was in its eighth inning -- people pay attention.

Fisher, who refrained from baseball analogies this time, said that after creeping higher for a number of years, "the inflation rate is near the upper end of the Fed's tolerance zone, and shows little inclination to go in the other direction."

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