U.S. stocks rally after Fed interest rate cut

NEW YORK, Dec. 16 (Chinese media) -- Wall Street rallied

Tuesday after the Federal Reserve decided to cut its main interest rate to a

record low.

Trader Thomas Ferrigno works on the

floor of the New York Stock Exchange, Dec. 16, 2008. U.S. stocks rose on

Tuesday, boosted by buying in the beaten-down financial sector and as

investors looked ahead to another expected interest rate cut from the

Federal Reserve.(Chinese media/Reuters Photo)
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The Fed's Open Market Committee announced Tuesday

afternoon that it will lower the Fed benchmark interest rate to the range of

zero to 0.25 percent, which is down from the 1 percent target rate in effect

since the last meeting in October. Financials rallied on the bet.

Goldman Sachs gained more than 15 percent after the

company reported less-than-expected fourth-quarter losses. The loss of 4.97 U.S.

dollars a share was the company's first quarterly deficit since going public in

1999.

Fertilizer stocks rallied after the shares were

upgraded to "buy" by Merrill Lynch.

In Tuesday's economic data, the U.S. Commerce

Department reported a 18.9 percent drop in new home construction in November,

while the Labor Department said consumer prices sank by 1.7 percent at the same

time.

The Dow Jones jumped 359.61 to 8,924.14. Broader indexes also gained. The Standard Poor's 500 index hiked 44.61 to 913.18 and the Nasdaq added 81.55 to 1,589.89.

Graphics shows selected interest rates around the world as of Dec. 16, 2008. (Chinese media Photo/Zhang Liyun)
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