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Stocks Inch Up After Fed Action

Bad news and lingering doubts about yesterday's cut keep rally tame

By Jonas Oransky,  Newser Staff

Posted Dec 12, 2007 3:29 PM CST
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(Newser) – Stocks gained slightly after the Fed's decision to join four other central banks in pumping cash into the global financial system. Following yesterday's plunge of nearly 300 points after the Fed cut interest rates by only a quarter-point, the Dow gained 41.13 to close at 13,473.90. The Nasdaq was up 18.79 to 2,671.14, while the S&P tacked on 8.95 to close at 1,486.60.

 We've got this new medicine we can try. I think we all can celebrate that.," an analyst told Bloomberg. Bank of America dropped 3.1% after warning of a tough road ahead, and JP Morgan Chase, Wachovia, and BoA all were downgraded by Merrill Lynch. The trade deficit also rose higher than anticipated in October, taking spark out of a morning rally.

Trader Michael Scagnelli bites his fingernail as he works on the floor of the New York Stock Exchange, Monday, Dec. 10, 2007. Wall Street advanced Monday as expectations for an interest rate cut from the Federal Reserve and an uptick in pending home sales helped offset concerns about another round...
Trader Michael Scagnelli bites his fingernail as he works on the floor of the New York Stock Exchange, Monday, Dec. 10, 2007. Wall Street advanced Monday as expectations for an interest rate cut from...   (Associated Press)
Traders Joel Lucchese, center, and Donna Izzo work on the floor of the New York Stock Exchange, Tuesday, Dec. 11, 2007. Wall Street rose modestly Tuesday as investors awaited the Federal Reserve's interest rate decision and absorbed more fallout from the mortgage and credit crisis. (AP Photo/Richard Drew)
Traders Joel Lucchese, center, and Donna Izzo work on the floor of the New York Stock Exchange, Tuesday, Dec. 11, 2007. Wall Street rose modestly Tuesday as investors awaited the Federal Reserve's interest...   (Associated Press)
Trader Tommy Kalikas, foreground, talks into his mobile phone as he works on the floor of the New York Stock Exchange, Tuesday, Dec. 11, 2007. Wall Street rose modestly Tuesday as investors awaited the Federal Reserve's interest rate decision and absorbed more fallout from the mortgage and credit crisis. (AP...
Trader Tommy Kalikas, foreground, talks into his mobile phone as he works on the floor of the New York Stock Exchange, Tuesday, Dec. 11, 2007. Wall Street rose modestly Tuesday as investors awaited the...   (Associated Press)
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