Rate cuts boost stock market — but not for long

Updated

The struggling stock market is seeing a bit of a comeback after central banks around the world coordinated a cut in their short-term interest rates. But the initial bounce is fading, so the cuts didn’t reassure traders for very long.

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The rate cuts spurred a 200-point increase in the Dow Jones Industrial Average, but since then both the Dow and the Nasdaq have been fluctuating unpredictably. As of noon Pacific time, both indicators are up again — the Dow is up about 90 points, or (0.87 percent), from today’s open, while the more tech-heavy Nasdaq is up about 80 points (2.16 percent).

The cuts were highly anticipated, and occurred at the Federal Reserve, the European Central Bank and central banks in England, Switzerland, Canada, China and elsewhere. The Fed, for example, said it cut its target rate and discount rate by half a percentage point, to 1.5 percent.

It’s disappointing that the bounce didn’t last longer, but fluctuating prices are still better than the steady drop that’s occurring in Europe and that the U.S. market saw yesterday.

Update: So much that boost. There was a big sell off in the last hour or so before trading closed, leaving the Dow 189 points (2 percent) down, and the Nasdaq 14 points (0.83 percent) down.