Stocks slide after rate cut

Stocks fell Wednesday as investors welcomed the Federal Reserve's emergency rate cut, but remained wary about financial markets.
Credit markets remained tight following the news, with banks continuing to hoard cash. Treasury bond prices spiked as investors rushed to the comparative safe haven of U.S. government debt. The dollar tumbled versus the euro and yen. Oil prices slipped and gold prices rose.
The Dow Jones industrial average fell 140 points, or 1.4%, with Alcoa and Bank of America dragging after the two companies reported weak results in the past two days.
The Standard & Poor's 500 index lost 1.2% and the Nasdaq composite lost 1%.
All three major gauges had tumbled at the open, then seesawed through the morning as investors considered the emergency rate cut.
Also in the mix: a surprise rise in the August pending home sales index.
The Federal Reserve, in coordination with banks around the world, said it was cutting the fed funds rate by half a percentage point to 1.5%. The fed funds rate is a key short-term lending rate that impacts loans on credit cards, home equity lines and business loans. The Fed also cut the discount rate, a bank lending rate, by half a percentage point.
This is the latest step taken by various agencies over the past week in an attempt to get banks to start lending to each other again. The Dow has lost 1,400 points and the three major stock gauges have fallen to five-year lows as panicked investors have fled stocks.