on wild ride
The Nasdaq, down as much asStar-Bulletin news services
575 points, pares its loss to 75 while
the Dow, off 503, falls just 57
NEW YORK -- In the most volatile day ever for U.S. stocks, the Nasdaq composite index and the Dow Jones industrial average each plunged more than 500 points today before reversing course as buyers flooded back into the battered market.
Increasingly pessimism among investors about the future of technology stocks set off a 575-point slide in the Nasdaq and sent the index below 4,000 for the first time since Feb. 1. That spurred a steep selloff in the broader market. But bargain hunters looking for cheap deals after a two-day rout entered the market in late trading and helped lift stocks from their lows.
The Dow Jones industrial average ended down 57.09 at 11,164.84. The Nasdaq ended the day down 74.79 at 4,148.89. At its low point, the Nasdaq fell 574.57, or 13.6 percent, to 3,649.11; it had climbed as high as 4,283.45 in the first minutes of trading. The 634-point swing was the biggest ever for the Nasdaq. Today's losses added to a 349.15-point Nasdaq drop yesterday. At its lowest levels today, the Nasdaq was 27.7 percent below its March 10 record of 5,048.62. Historically, Wall Street has considered a drop of 20 percent from a peak the hallmark of a bear market. Analysts, however, were reluctant to predict whether the decline meant that the end of the long bull market in high-tech stocks is imminent.
"I think the bottom may be in place. That's not to say that we won't go back down and test these levels," said Brian G. Belski, chief investment strategist at George K. Baum & Co. in Kansas City, Mo.
The breadth and sharpness of the technology selloff ultimately pulled the broad market into a powerful decline. The Dow Jones industrial average was up 196 points in early trading, then fell as much as 503 before recovering to the 56-point loss. The 700.46-point swing from high to low was the biggest on record for the Dow.
Decliners beat advancers by a more than 2-to-1 margin on the New York Stock Exchange, with 1,011 up, 2,067 down and 377 unchanged. NYSE volume totaled 1.39 billion shares vs. 1.026 billion yesterday. The Standard & Poor's 500 fell 11.24 to 1,494.73. The Russell 2000 index fell 9.92 to 506.12; the NYSE composite index lost 7.36 to 652.30; and the American Stock Exchange composite dropped 35.48 to 942.52. Treasury bond prices rose, as investors fled to the safety of government debt. The 30-year bond rose point, or $5 per $1,000 face amount; its yield dropped to 5.77 percent from 5.81 percent yesterday.
The catalyst for yesterday's rout -- Microsoft Corp. -- slipped again today. After plunging $15.37 to $90.87 yesterday, Microsoft fell another $2.31 to $88.56 today.