NEW YORK, Oct. 7 (Xinhua) -- Wall Street ratcheted up and down Tuesday following the previous sell-off, after the Federal Reserve said it will purchase short-term corporate loans to help free credit markets. Dow Jones moved in and out of positive territory many times in morning trading.
The Fed announced a radical plan to buy massive amounts of short-term debts. Accordingly, the central bank will buy "commercial paper," a short-term financing mechanism that many companies rely on to finance their day-to-day operations. Investors calling for an interest rate cut were relieved after the Fed's new steps, hoping it will resume liquidity to the credit market.
Meanwhile, investors awaited speeches from Fed Chairman Ben Bernanke and European Central Bank President Jean-Claude Trichet, and the Fed is due to release minutes from the last interest-rate setting meeting.
In corporate news, Bank of America Corp. tumbled 15 percent in early trading after reporting late Monday that profits fell 68 percent during the third quarter. The bank also said it will raise10 billion U.S. dollars by issuing common stock and slashed its dividend.
Chip maker Advanced Micro Devices Inc. surged after it said to spin off its manufacturing businesses into a new joint venture with Abu Dhabi-backed Advanced Technology Investment Co.
The Dow Jones fell 25.97 to 9,929.53. Broader indexes also fell. The Standard & Poor's 500 index dipped 3.93 to 1,052.96 and the Nasdaq slipped 12.08 to 1,850.88.
