Markets finish mixed on light profit-taking

By Meg Richards
Associated Press

NEW YORK — Lower-than-expected sales at Cisco Systems Inc. sent tech stocks tumbling yesterday while the overall market was little changed after the Federal Reserve announced a widely expected interest rate hike. A jump in oil prices contributed to mild profit-taking.

The Fed's Open Market Committee nudged interest rates up a quarter point, bringing the federal funds rate — the interest banks charge each other on overnight loans — to 2 percent. The market had little reaction to the rate hike, though investors closely read the Fed's policy statement for hints about what lies ahead. Analysts took it as a good sign that the language in the statement was largely unchanged.

"This gives a very positive tone to their outlook on the U.S. economy, despite higher energy prices," said Joseph V. Battipaglia, chief investment officer at Ryan Beck & Co. "There's nothing to fear on the inflation front from where they sit, and they see flexibility in the labor market, which suggests they will allow faster job growth to show itself without having to move any quicker on rate changes."

The Dow Jones industrial average was down 0.89, or 0.01 percent, at 10,385.48.

The broader gauges were narrowly mixed.

Despite relatively good economic news, overall trading was tepid, particularly in the face of volatile oil prices. The government's weekly report on petroleum inventories showed another decline in the nation's supply of distillate fuels, which include heating oil.

Advancing issues outnumbered decliners about 3 to 2 on the New York Stock Exchange. Preliminary consolidated volume came to 1.95 billion shares, compared with 1.91 billion on Tuesday.