Stocks fell yesterday in volatile trading after the Federal Reserve decided against raising interest rates immediately but left open the possibility of a third hike later this year.

The Dow Jones closed 0.64 points lower at 10,400.59, having swung from a 106-point gain to a 124-point loss over the final two hours.

Broader stock indexes also turned lower in the afternoon, peaking just as the Fed was set to announce the outcome of its latest meeting on inflation and interest rate strategy.

Declining issues outnumbered advancers by a ratio of nearly three-to-two on the New York Stock Exchange, with 1,794 up, 1,241 down and 505 unchanged. NYSE volume totalled 954.23 million shares at the close, up sharply from 795.96 million at the same point on Monday. The Russell 2000 index of smaller companies fell 0.60 to 426.01.

Fed officials, faced with a booming economy but no signs of inflation, decided not to raise interest rates, but shifted their policy bias from neutral toward a possible rate increase in the coming months.