US rate cut sends stocks lower

US blue chips fell today after the Federal Reserve delivered a smaller interest rate cut than Wall Street wanted.

The Fed announced it was lowering short-term rates by 0.25%, half of what the market felt was necessary to restart the economy. It was the sixth cut this year.

The Dow Jones industrial average ended down 37.30 at 10,435.18 after being up about 25 before the Fed's announcement.

The broader market finished mixed. The Nasdaq composite index eked out a modest gain, up 10.12 at 2,074.74 while the Standard & Poor's 500 index fell 5.69 to 1,211.07.

Investors have been anxiously awaiting signs that the five earlier reductions - each 0.5% - have helped business pick up. But so far, corporate profit warnings, topping 600 so far this quarter, have indicated business remains weak in many sectors.

Analysts did not expect a rally to follow this latest rate cut, regardless of its size.

However, analysts also pointed out that it typically takes six to nine months after the Fed starts lowering rates for the economy and business to benefit. The Fed made its first two cuts in January.

Most of the market's gains and losses were moderate.

Lucent slipped 13 cents to $5.87 after The Wall Street Journal reported that the company might lay off an additional 10,000 workers because of continued restructuring.

General Mills rose 50 cents to $42.80 after the maker of Wheaties, Cheerios and Chex reported earnings that met analysts' expectations.