NEW YORK ( TheStreet) -- Investors felt a bit of relief and lifted stocks off their session lows Tuesday after the Federal Open Market Committee offered a tempered response to the downgraded growth picture, saying it would keep securities holdings at their current level by reinvesting in longer-term Treasuries. Stocks had lost ground for much of the day after weak reads on Chinese import demand and U.S. productivity did little to build confidence in the recovery. The Dow Jones Industrial Average, which had been down well over 100 points earlier in the session, finished off by 56 points, or 0.5%, to 10,644. The S&P 500 shed 7 points, or 0.6%, to 1121, and the Nasdaq finished 29 points lower, or 1.2%, at 2278. On Tuesday, the Fed's monetary-policy-setting arm said the economic recovery was slowing, highlighting a weak labor market, tight credit and little income growth. The FOMC continued holding its target interest rate at near zero, while also saying it would "keep constant the Federal Reserve's holdings of securities at their current level by reinvesting principal payments from agency debt and agency mortgage-backed securities in longer-term Treasury securities" and rolling over Treasury holdings as they mature. "I thought this was a really good middle of the road solution. It effectively is not pandering to either extreme," said Marc Pado, U.S. market strategist at Cantor Fitzgerald, saying the statement didn't include a new, broader quantitative easing program, but still did more than stay pat. "I think they wanted to walk that line -- not increasing the balance sheet, but not reducing the balance sheet... so, I think it was well played. The goal here was to do some modest quantitative easing." Domestic stocks got off to a rough start, and the major indexes in Europe and Asia fell overnight, in response to news that
China's trade surplus rose to an 18-month high of $28.7 billion in July, signaling a sharp downturn in import demand. Also impacting Asian markets, the Bank of Japan voted to keep the uncollateralized overnight call rate at around 0.1% and left its view of the economy unchanged. Overseas, Hong Kong's Hang Seng declined 1.5%, and Japan's Nikkei slipped 0.2%. The FTSE in London was losing 1%, and the DAX in Frankfurt was down by 1.4%.