The Federal Reserve on Wednesday extended a program designed to keep long-term interest rates low but chose not to introduce any new stimulus to kick-start the sputtering U.S. economy.

Fed Chairman Ben Bernanke later defended the action against critics who suggested the Fed isn't doing enough to spur economic growth.

"We took a substantive step today ... and we're prepared to do more," Bernanke said during a press conference that concluded two days of meetings by the Federal Open Market Committee, which sets most Fed policy.

Stock markets reacted negatively to the announcement despite the move being widely expected.

Stock markets dipped on the 12:30 p.m. announcement then bounced back into positive territory briefly only to fall again late in the session. The Dow Jones Industrial index was down 80.83, or 0.63%, at 12,756.50. The S&P 500 and Nasdaq Stock markets also fell to session lows.