U.S. stocks have rebounded slightly after the Dow Jones industrial average fell more than 350 points in early morning trading after the Federal Reserve announced that it had cut the federal funds rate three-fourths of a percentage point this morning.

As of 9 a.m. Iowa time, the Dow Jones industrial average was down more than 350 points, or 2.94 percent, but by 10:40 a.m. it was down 209.07 points, or 1.73 percent, to 11,890.23. The Nasdaq composite average was down 56.79 points, or 2.43 percent, and the Standard & Poor’s 500 index was down 20.69 points, or 1.56 percent, as of 10:40 a.m.

In an emergency conference call last night, the Federal Reserve decided to cut the federal funds rate to 3.5 percent from 4.25 percent, the Associated Press reported.

The move comes before the Fed’s scheduled meeting next week. It is the first time it has altered the federal fund rate between scheduled meetings since after the markets reopened after the Sept. 11, 2001, terrorist attacks, the strongest sign yet that the Fed is worried about a recession. It also is the biggest one-day rate move the Fed has made since it lowered the rate by 1 percentage point in December 1991, when the United States was trying to emerge from recession.

The move comes after stock markets around the world fell dramatically over the past two days and U.S. stocks tumbled last week. Japan’s Nikkei stock average closed 5.65 percent lower today, the biggest percentage decrease in nearly a decade. Hong Kong’s Hang Seng index fell 8.65 percent. In afternoon trading, Britain’s FTSE 100 fell 0.57 percent and Germany’s DAX index was down 2.15 percent.