NEW YORK - US stocks clawed back most of Monday's losses as a US Federal Reserve promise of at least two more years of near-zero interest rates overshadowed its warning about slowing economic growth.
The Fed's statement gave markets a glimmer of hope, with stocks' gains accelerating into Tuesday's close.
In a sign investors were not entirely convinced of the Fed's ability to stave off another recession, they sought safer bets, including the Swiss franc and gold. Gold pared its early
gain to record levels but was still up about 1 percent at just above $1,728 an ounce.
But Wall Street still almost reversed Monday's meltdown -- the steepest fall in nearly three years. However, the S&P 500 is down 14 percent from its April peak, with the bulk of selling coming after a downgrade to US debt and festering concern about the euro zone's inability to solve its own persistent credit problems.