Stocks fell on Tuesday, while short-dated bonds rallied in a volatile market response to the decision by the Federal Reserve to take a pause from raising interest rates after 17 successive quarter-point tightenings.

The intial reaction saw a sharp whipsaw, as the major indices gained, fell, and regained all their lost ground before finally slipping back towards the end of the session. By the close, the Dow Jones Industrial Average was down 0.4 per cent, the S&P 500 was 0.3 per cent weaker, and the Nasdaq Composite was off 0.6 per cent. The rate-sensitive Russell 2000 index of smaller companies slid 1.4 per cent.