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Global equity markets gave up earlier gains on Wednesday after the U.S. Federal Reserve announced another interest rate hike and said “some” further rate hikes would be necessary in the year ahead.

The decision, announced at 2 p.m. Eastern time (1900 GMT), briefly slashed nearly 200 points off of the Dow Jones Industrial Average and halved the day’s modest gains in MSCI’s index of global stocks. The index remains down nearly 12 percent since the start of December.

“This is clearly a disappointment for those hoping for a dovish rate hike,” said David Joy, chief market strategist at Ameriprise Financial in Boston. “It is a more moderate rate hike but it is a rate hike and there is still a gap between where the Fed is and where the market is in terms of policy expectations for next year.”

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On Wall Street, the Dow Jones Industrial Average fell 87.55 points, or 0.37 percent, to 23,588.09, the S&P 500 gained 13.76 points, or 0.54 percent, to 2,559.92 and the Nasdaq Composite added 17.11 points, or 0.25 percent, to 6,801.02.

In Canada, the TSX was trading near unchanged.

U.S. stocks are on pace for their biggest December decline since 1931, the depths of the Great Depression.

The latest jolt on the growth front came from Japan, which said its export growth slowed to a crawl in November, an ominous signal for the trade-focused economy.

Logistics and delivery firm FedEx, considered a bellwether for the world economy, slashed 2019 forecasts, noting “ongoing deceleration” in global growth.

“It’s a confluence of several important factors: the market is adjusting its outlook on growth and there is a consensus we will see a slowdown. More importantly, the market is adjusting to the idea this will translate into lower earnings growth,” said Norman Villamin, chief investment officer for private banking at Union Bancaire Privee in Zurich.

“It’s being complicated by the tightening liquidity situation with the Fed expected to move today and the ECB having signaled the end of its (stimulus).”

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Expectations of a Fed pause and the equity sell-off have sent 10-year Treasury yields to their lowest since August. Benchmark 10-year notes last rose 10/32 in price to yield 2.787 percent, from 2.823 percent late on Tuesday.

Yields in Japan and Australia also reached multi-month lows.

The dollar index fell 0.1 percent, with the euro up 0.11 percent to $1.1374.

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