Stocks cut gains further and the Dow turned negative on Wednesday after the Federal Reserve said the economy was likely to remain weak for a time and investors remained nervous over the threat of inflation.

The Fed is a little more downbeat than the market has been ... That they're emphasizing the weakness is a touch disappointing to me and to the markets, said Jim Awad, managing director at Zephyr Management in New York.

The Dow Jones industrial average <.DJI> fell 31.36 points, or 0.38 percent, to 8,291.55. The Standard & Poor's 500 Index <.SPX> rose 4.07 points, or 0.45 percent, to 899.17. The Nasdaq Composite Index <.IXIC> added 23.78 points, or 1.35 percent, to 1,788.70.

(Reporting by Leah Schnurr and Ryan Vlastelica; Editing by Kenneth Barry)