Stocks recoup losses after Fed

(CNNMoney.com) -- Stocks pared sharp losses to close only modestly lower Tuesday after the Federal Reserve took a cautious stance about the recovery.

After falling as much as 147 points earlier in the session, the Dow Jones industrial average (INDU) was off 53 points, or 0.5%, to close at 10,644.86, according to early tallies.

The S&P 500 (SPX) lost 7 points, or 0.6%, to end at 1,121.08, and the Nasdaq (COMP) dropped 29 points, or 1.2%, to close at 2,277.17.

As was widely expected, the central bank said it would leave short-term interest rates unchanged in a range between 0% and 0.25%. But the Fed gave its most bearish outlook in more than a year, saying the economic recovery is weakening. (more)