US STOCKS-Wall St down after Fed; Microsoft weighs on Nasdaq

                                

                                
 * Fed hints at more easing
                                
 * Microsoft raises quarterly dividend, shares down
                                
 * Indexes off: Dow 0.1 pct, S&P 0.2 pct, Nasdaq 0.6 pct
                                
 * For up-to-the-minute market news see [STXNEWS/US]
  (Updates to mid-morning trade)
                                
 By Angela Moon
                                
 NEW YORK, Sept 22 (Reuters) - Wall Street fell on Wednesday
after Federal Reserve comments about inflation triggered demand
for inflation-sensitive assets like gold and pushed investors
away from stocks.
                                
 The technology sector was lower, with Microsoft Corp
<MSFT.> off 2.5 percent at $24.54 after the company raised its
quarterly dividend, the latest move by a technology company to
return cash to shareholders frustrated by stagnant share
prices. For detail, see [ID:nN21191991]
                                
 Gold hit a record above $1,295 per ounce, and U.S. 30-year
Treasury bonds rose a point as yields fell to a three-week lows
on hopes the Fed may boost its purchases of Treasuries as part
of quantitative easing.
                                
 "The Fed sort of left the market guessing on exactly how
large or what their action would be," said Jeff Kleintop, chief
market strategist at LPL Financial in Boston.
                                
 "The only thing that the market is convinced of is that the
Fed wants to see more inflation, and that is triggering demand
for inflation-sensitive assets like gold and commodities as a
flight from stocks,"
                                
 The Fed explicitly stated for the first time on Tuesday
that core inflation was running below policymakers' comfort
levels.
                                
 The Dow Jones industrial average <.DJI> was down 7.03
points, or 0.07 percent, at 10,754.00. The Standard & Poor's
500 Index <.SPX> fell 2.76 points, or 0.24 percent, at
1,137.02. The Nasdaq Composite Index <.IXIC> was off 13.11
points, or 0.56 percent, at 2,336.24.
                                
 Alcoa Inc <AA.N> was the biggest gainer on the Dow, up 4
percent at $11.60. The S&P Energy <.GSPE> sector rose 0.3
percent, outperforming others groups.
                                
 The Fed statement halted a Tuesday rally that has sparked
the S&P 500 to rally nearly 9 percent in the last month. The
index closed at a four-month high on Monday.
                                
 Adobe Systems Inc <ADBE.O> slid 20.4 percent to $26.23
after the software maker forecast lower-than-expected revenues.
[ID:nN21181826]
                                
 Potentially unsettling Wall Street, White House economic
adviser Larry Summers said he will leave as director of the
White House National Economic Council, marking a major staff
shake-up for U.S. President Barack Obama as he faces pressure
to revive the economy. [ID:nN21186370]
                                
 U.S. Treasury Secretary Timothy Geithner is to appear at a
House Financial Services Committee hearing on the state of the
international financial system.
                                
 On the earnings front, cereal maker General Mills Inc
<GIS.N> reported slightly better-than-expected quarterly
profit. The stock rose 2.4 percent at $36.53.
                                
 EBay Inc <EBAY.O> fell 4.4 percent to $23.65 after the
online auctioneer forecast third-quarter results near the high
end of its July outlook. [ID:nN21180941]
  (Reporting by Angela Moon; editing by Jeffrey Benkoe)