Stocks retreated yesterday after mounting a big rally on an interest rate cut by the European Central Bank. The Dow Jones industrial average ended with a modest gain of 33.15 points, or 0.35 per cent, at 9,587.52, according to the latest data. Earlier, the Dow was up nearly 170 points, or 1.75 per cent.

The Nasdaq composite fell 9.76 points, or 0.53 per cent, to 1,827.77 after giving back a gain of 51 points, or nearly 2.8 per cent. The broad Standard & Poor's 500 index edged up 2.74 points, or 0.25 per cent, at 1,118.54.

Stoking the early bullishness was the European Central Bank and Bank of England rate cuts of half a percentage point. This followed a half-point cut by the US Federal Reserve on Tuesday.

The retreat in stocks coincided with the release of minutes of the Federal Reserve's October 2nd policy meeting, which revealed committee members believed the September 11th attacks dealt a blow to an already struggling US economy, but still thought a "relatively mild and short contraction" in economic activity, followed by a recovery next year, was the most likely outcome.