By Noel Randewich
(Reuters) - Wall Street erased gains and fell on Wednesday after the U.S. Federal Reserve failed to satisfy investors hoping for a stronger sign it might scale back future interest rate hikes.
In a widely expected decision, the Fed kept interest rates unchanged and it said it was "closely monitoring" global economic and financial developments, but it maintained an otherwise upbeat view of the U.S. economy.
"Markets across the globe do not think it was prudent for the Fed to raise rates last month," said Adam Sarhan, CEO of Sarhan Capital. "The fact that the Fed is now starting to raise rates clearly shows you they are disconnected from what is actually happening on the ground."
Major stock indexes reversed earlier gains and moved lower.
At 2:22 pm, the Dow Jones industrial average was down 0.39 percent to 16,104.09 points while the S&P 500 had lost 0.05 percent to 1,902.7.
The Nasdaq Composite dropped 0.92 percent to 4,525.71.
Apple's shares fell 5.2 percent after the iPhone maker reported its slowest-ever rise in shipments on Tuesday, while Boeing (N:BA) lost 8.5 percent, on track for its biggest fall since August 2011.
Brent crude oil soared nearly 5 percent after Russia said it was discussing the possibility of cooperation with OPEC and U.S. data showed an increase in short-term demand. That helped stocks ahead of the Fed's announcement.
While the major indices were lower, seven of the 10 major S&P sectors were up, led by a 1.53-percent rise in energy stocks. The tech sector was down 1.25 percent.