Wall Street down on Fed disappointment

A late afternoon slide yesterday pulled stock indexes lower after the Federal Reserve held off on any new steps to boost the economy. The Fed cautioned strains in global financial markets still pose a danger, a nod to Europe's debt crisis.

The Dow Jones industrial average fell 66.45 points, or 0.55 percent, to close at 11,954.94. The Dow had risen 126 points earlier after two strong auctions of European debt but dropped more than 70 points in the last hour of trading.

The Standard & Poor's 500 index fell 10.74 points, or 0.87 percent, to 1,225.73. The Nasdaq composite fell 32.99 points, or 1.26 percent, to 2,579.27.

The Federal Reserve portrayed the U.S. economy as slightly healthier but cautioned it remains vulnerable to the European debt crisis. "Strains in global financial markets continue to pose significant downside risks to the economic outlook," the Fed said. Stock indexes turned lower after the Fed released its policy statement at 2:15 p.m.

Stocks had been higher for most of the day after the Spanish government was able to sell short-term debt at much lower interest rates compared with a month ago, a signal that markets are becoming less fearful about the government's ability to repay its debt.