Wall Street rally fades late after Fed; Cisco up late

By Chuck Mikolajczak

NEW YORK (Reuters) - U.S. stocks rallied but lost steam

on Wednesday after the Federal Reserve said it would keep rates near zero for "an extended period" even as it expressed confidence in the economic recovery.

Stocks pushed higher in the hour following the FOMC statement, after the Fed kept its benchmark federal funds rate unchanged in a range of zero to 0.25 percent. For details, see [ID:nN04453484] The S&P 500 rose as high as 1,061.00 and the Nasdaq touched 2,081.00.

But the market was unable to hold those gains as it succumbed to selling pressure in the last half-hour of trading.

"This doesn't change much. It's hard to figure out how this could be helpful for the upside, though it easily could have been negative," said Jordan Posner, portfolio manager at Matrix Asset Advisors in New York.

"The good news is more an absence of anything bad."

The Fed's closely watched policy statement was somewhat more upbeat than its statement in September. However, it was also more explicit about why it expects to keep rates low, citing "low rates of resource utilization, subdued inflation trends, and stable inflation expectations."

After the closing bell, Cisco Systems Inc (CSCO.O: Quote, Profile, Research) gained 3.1 percent to $24.02 after the network equipment vendor said quarterly revenue rose more than expected from its previous quarter. The company also said its board authorized up to $10 billion in additional stock buybacks.