YAHOO: The stock market settled with a 1.1% loss Wednesday after late-session surge made in the final hour following an FOMC rate cut was reversed in the final minutes of trade after headlines hit the wires that raised concerns regarding General Electric's (GE 19.20, -0.29) revenue in 2009. Meanwhile, commodities made one of the strongest gains on record as the dollar got hammered.

Specifically, the S&P 500 was up 3.1% with 10 minutes left in the session and then quickly sank to a 1.8% loss before settling with a decline of 1.1%. Small and mid-cap stocks outperformed with gains of 1.7% and 1.8%, respectively.

With regard to GE, Dow Jones reported that the conglomerate is aiming to keep 2009 profit the same as 2008, even if revenue declines 10-15%. The profit outlook is good news given the current consensus estimate anticipates a 9% decline year-over-year. However, the revenue view doesn't say much about the economic outlook and implies that GE will cost cuts to meet its profit goal.

This was disappointing to the market when thinking of the demand outlook for this global company, sparking a sweeping decline in other multi-national companies in the final minutes of the trading session.

After the close, however, CNBC noted that GE said the comment was not new and shares of GE were trading up in the after hours session.

The Federal Open Market Committee cut the fed funds rate by 50 basis points to 1.00%. This marks the lowest level since June 2004. The discount rate was reduced by 50 basis points to 1.25%. Both actions were unanimously approved. The Fed said the pace of economic activity has "markedly" slowed as consumer expenditures declined, while inflation pressures are expected to moderate due to the drop in commodity prices and weaker economic prospects.

The FOMC believes that over time this action, along with the Fed's other measures, will help promote moderate economic growth. The announcement did not give any surprises, and left the possibility for further rate cuts.

Separately, the Fed established temporary currency swap lines with the central banks of Brazil, Mexico, South Korea and Singapore. The move is meant to improve liquidity and complement the Fed's current swap lines with ten other central banks.

Seven of the ten sectors posted a loss.

Consumer staples stocks trailed the broader market even though Procter & Gamble (PG 61.33, -1.90), Kraft (KFT 28.47, -0.41 ) and Kellogg (K 50.02, -0.66) all reported better-than-expected quarterly earnings results.

The telecom (-3.3%) sector was laggard after Qwest (Q 2.33, -0.27) reported worse than expected quarterly earnings and said it was cutting 1,200 jobs, or 3% of its workforce.

The consumer discretionary sector outperformed on a relative basis with a decline of 0.1%. Casino and gaming stocks soared 11.5% after MGM Mirage (MGM 13.75, +3.42) reported an earnings drop and outlook that was better-than-feared.

Commodities rallied across the board in a rebound trade that was compounded by a 2.7% drop in the dollar. Crude oil prices spiked 9.8% to $68.90 per barrel, getting an added lift after the government's weekly energy report showed a smaller-than-expected increase in crude inventory levels.

As a result, the energy (+2.3%) and material (+2.7%) posted the largest gain this session.

In economic news, September durable goods orders rose 0.8%, better than the expected decline of 1.1%. Excluding transportation, durable goods orders fell 1.1%, which was better than the expected decline of 1.5%. However, nondefensive capital goods excluding aircraft, which is a proxy for business investments, fell 1.4%. DJ30 -74.16 NASDAQ +7.74 NQ100 +0.4% R2K +1.7% SP400 +1.8% SP500 -10.42 NASDAQ Adv/Vol/Dec 1610/2.78 bln/1138 NYSE Adv/Vol/Dec 1954/1.62 bln/1145