Global Markets-fed's Stimulus Cut Hits Stocks; Gold, Bonds Rise

"QE was creating a chase for yield and now that game is over. It was creating potential bubbles," said Doug Cote, chief market strategist at ING U.S. Investment Management in New York. "By continuing the taper the Fed is mitigating future risk. I'd rather have a correction now than a bubble bursting down the road," Cote said.

CANADA STOCKS-Fed, emerging-market worries drag TSX lower

Doubts about China, coupled with extreme volatility in the Argentine peso and the Turkish lira, have raised questions about the risks involved with investing in emerging markets. The Toronto Stock Exchange's benchmark index, with its high concentration of resource shares, has lost about 2.7 percent in the last week. "The bigger issue for us is the emerging market chaos. It's knocking the stuffing out of positive sentiment," said Bill Harris, portfolio manager at Avenue Investment Management. "Stocks are going to come off because the market is nervous." "The Fed is still trying to play its hand from information from a year ago, and now the world is changing dramatically," he added.