* Fed to reduce stimulus by a further $10 billion/month
* South Africa raises rates for first time in 6 years
* Boeing, Yahoo fall after results
* Dow down 1 pct; S&P down 0.8 pct; Nasdaq off 0.9 pct
By Caroline Valetkevitch
NEW YORK, Jan 29 U.S. stocks were down as much
as 1 percent in volatile trading on Wednesday following the
Federal Reserve's decision to further reduce its monthly bond
Indexes added to losses as investors digested the Fed's
announcement to cut a further $10 billion from its monthly bond
purchases, sticking to its plan to scale back stimulus despite
recent turmoil in emerging markets.
"This was pretty much as expected," said Wayne Kaufman,
chief market analyst at Rockwell Securities in New York. "Ten
billion more in tapering, but the Fed is still doing tremendous
amounts of asset purchasing."
Stocks had been lower ahead of the announcement amid
concerns that bold efforts by Turkey and South Africa to
stabilize their currencies may not be enough to staunch a cycle
of selling in emerging markets.
The benchmark S&P 500 has lost ground in four of the past
five sessions amid fears over slowing growth in China and large
capital outflows from developing markets as investors sought
Selling was fairly broad-based, with nine of the 10 S&P 500
sectors trading lower and shares of Boeing Inc among the
biggest drags. The stock fell 6 percent to $128.91, even as it
reported a 26-jump in quarterly profit.
The Dow Jones industrial average fell 164.72 points
or 1.03 percent, to 15,763.84, the S&P 500 lost 15.13
points or 0.84 percent, to 1,777.37 and the Nasdaq Composite
dropped 37.182 points or 0.91 percent, to 4,060.781.
South Africa's central bank raised interest rates for the
first time in six years. This followed a dramatic rate hike by
Turkey's central bank, designed to defend its crumbling
Yahoo shares were also down sharply, falling 8
percent to $35.17 after reporting results late Tuesday.