Small caps are trading in a narrow range between positive and negative territory following a 50 basis point cut in the fed funds rate. At 2:33 p.m. ET, the Russell 2000 (NYSE:IWM) was up 1.64, or 0.34%, at 484.38.

The Federal Reserve concluded its two day federal open market committee meeting today with a widely expected 50-basis-point cut in the federal funds rate.

The Fed’s cut comes on the heels of a 0.27% rate cut in China. In Europe, the European Central Bank hinted that rate cuts are possible in the near-term. Rate cuts globally would help thaw the still tight credit markets around the world, easing the flow of credit.

Libor slipped for the 13th consecutive trading day, and commercial paper activity picked up dramatically following the Fed’s new program to purchase commercial paper. Evidence that the credit markets are showing signs of marginally loosening boosted the U.S. markets Tuesday and pushed overseas markets higher today.

In economic news, durable goods orders clocked in above expectations, with a gain of 0.8%, compared with the forecast for a drop of 1.1%. However, the favorable surprise couldn’t boost the market, as traders remain cautious on the dreary economic outlook...

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