Closing Market Report

Star-Bulletin news services

Monday, August 2, 1999

Dow slips 9

NEW YORK -- The continuing threat of higher interest rates demolished a rally on Wall Street today, sending stocks lower even after a new report suggested the economy may not be overheating after all.

The Dow Jones industrial average was down 9.19 at 10,645.96. The index had risen as much as 136 points earlier in the session.

Broader stock indicators also gave up early gains and finished lower. The Standard & Poor's 500 fell 0.67 to 1,328.05 and the Nasdaq composite index dropped 14.86 to 2,623.63.

Decliners beat advancers by a 7-to-5 margin on the New York Stock Exchange, with 1,729 down, 1,215 up and 549 unchanged. NYSE volume totaled 629.25 million shares vs. 725.74 million Friday.

The NYSE composite index fell 0.73 to 625.34; the American Stock Exchange composite index lost 4.59 to 783.64; and the Russell 2000 index of smaller companies slipped 2.14 to 442.63.

The 30-year U.S. Treasury bond fell 5/32, or $1.56 per $1,000 face amount, to a price of 88 7/32. Its yield rose 1 basis point to 6.11 percent.

Stocks rebounded in early trading today from last week's steep losses after the National Association of Purchasing Management said the U.S. manufacturing sector grew in July for the sixth consecutive month, but not as strongly as most analysts expected.

The market had anticipated that the report, which gauges manufacturing activity, would show continued economic expansion and raise the likelihood of the Federal Reserve hiking interest rates later this year. The report is the first reading on the U.S. economy's performance for July.

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