Stocks fall after the initial advance by Zuzana Zelenakova

Further interest rate cuts by US Federal Reserve failed to achieve the hoped for goal on stock markets Wednesday. The Fed cut its key interest rate for the second time in one week and slashed it by half percentage point. Last week the Fed performed the biggest rate cut, of three-quarters of a point, in twenty years to prevent the country from slowing economy and slumping into recession. The move came after global stock markets fell sharply due to the prospect of US sluggish economic growth. Markets initially soared after the second cut, but the advance did not last long and Wall Street closed lower again. It is possible further rate cuts will come. The Dow Jones finished 0.30 percent down at 12.442. The Standard and Poor's 500 index fell 0.48 percent to 1.355 and Nasdaq index declined by 0.38 percent at 2.349. Overseas markets has experienced the similar tendency, but they closed lower prior to the Fed's rate cut decision. London FTSE 100 declined by 0.81 percent, French CAC40 lost 1.37 percent. In Tokyo, Nikkei fell by 0.99 percent. "Volatility is here to stay," said Anthony Conroy from BNY ConvergEX Group. "People who think these issues will go away overnight in one Fed rate cut are mistaken."

related story: http://news.yahoo.com/s/ap/20080130/ap_on_bi_st_ma_re/wall_street;_ylt=AtQCJXNAENn8kqvA2V449BGs0NUE

by Zuzana Zelenakova for PocketNews (http://pocketnews.tv)

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Edited by Federica Paddeu