* U.S. Fed revamps rates guidance, trims bond buys further
* Wall Street turns lower following Fed statement
* Treasuries fall, yields higher
(Updates with U.S. Fed statement)
By Angela Moon
NEW YORK, March 19 The world's major stock
markets dipped while yields on U.S. Treasuries rose on Wednesday
after the Federal Reserve dropped the unemployment rate as its
definitive yardstick for gauging the U.S. economy's strength and
made clear it would rely on a wide range of measures in deciding
when to raise interest rates.
At the same time, the U.S. central bank said dropping a
promise to hold rates steady "well past the time" the U.S.
unemployment rate falls below 6.5 percent did not indicate any
change in the Fed's policy intentions.
Wall Street reacted with a modest selloff with major indexes
falling to session lows shortly after the statement from the
Fed's latest policy meeting.
"This statement from the Fed is as hawkish as it gets - the
only thing they did not do is (raise) rates today. The Fed is at
neutral now and expect rate hikes to begin sometime in early
2015," said Thomas di Galoma, head of fixed-income rates at ED&F
Man Capital Markets in New York.
The benchmark 10-year Treasury notes yield rose
7.5 basis points to 2.753 percent while the 5-year notes
yields surged 12 basis points to 1.67 percent.
The 3-year Treasuries yields rose 10.5 basis
points to 0.862 percent, the highest level since January.
In the currency market, the euro and the yen extended losses
against the dollar.
The central bank proceeded with its well-telegraphed
reductions to its massive bond-buying stimulus, announcing it
would cut its monthly purchases of U.S. Treasuries and
mortgage-backed securities to $55 billion from $65 billion.
On Wall Street, the Dow Jones industrial average fell
48.79 points or 0.3 percent, to 16,287.4, the S&P 500
lost 4.43 points or 0.24 percent, to 1,867.82 and the Nasdaq
Composite dropped 11.02 points or 0.25 percent, to
The FTSEurofirst 300 edged down 0.03 percent, at 1,305.68
points, while the euro zone's blue-chip Euro STOXX 50
index was up 0.2 percent at 3,078.78 points.
(Editing by Chizu Nomiyama)