Closing Market Report

Star-Bulletin news services

Wednesday, October 17, 2001

Stocks fall on anthrax
fears, Greenspan talk

By Amy Baldwin
Associated Press

NEW YORK >> A disappointing assessment of the economy and news that anthrax has been found on Capitol Hill squelched a surge of optimism on Wall Street today and gave the stock market its worst day in more than three weeks.

The 151-point drop in the Dow Jones industrials was the biggest slide in the blue-chip index since the first week of trading after the Sept. 11 terrorist attacks. The Nasdaq composite and Standard & Poor's 500 indexes also had their largest declines since that turbulent week.

Federal Reserve Chairman Alan Greenspan's warning of a dip in productivity overshadowed a positive report on housing. And an announcement that the House will close tomorrow through Monday to test for anthrax quashed investors' enthusiasm about positive earnings from IBM and J.P. Morgan Chase.

The market's major indicators gave up solid early gains and retreated further as the day wore on.

"We were holding up on the profit front," said Ronald J. Hill, investment strategist for Brown Brothers Harriman & Co. "But those aren't real happy things for the market," particularly the latest anthrax findings, this time on Capitol Hill and the office New York Gov. George Pataki.

The Dow finished down 151.26 at 9,232.97, having relinquished an early 104-point advance. The Nasdaq composite index down 75.73 at 1,646.34 and the Standard & Poor's 500 index down 20.45 at 1,077.09.

Decliners outnumbered advancers on the New York Stock Exchange, with 1,972 down, 1,143 up and 200 unchanged. Volume was 1.42 billion shares vs. 1.21 billion shares.

The NYSE composite index fell 7.35 to 557.92, the American Stock Exchange composite index lost 7.52 to 823.01 and the Russell 2000 index fell 10.05 to 424.48.

The Treasury's 2-year note fell 1/32 to 99 - 31/32; its yield rose 2 basis points to 2.76 percent. The 10-year note fell 1/32 to 10314/32; its yield was unchanged at 4.56 percent. The 30-year bond increased 13/32 to 100 - 29/32; its yield fell 3 basis points to 5.31 percent.

The downturn came as Greenspan told Congress it's too early to tell how much the economy was hurt by the terrorist attacks, although productivity is certain to suffer. Meanwhile, congressional leaders announced that more than 30 people had tested positive for anthrax at the Capitol.

Among Wall Street's losers was data storage company EMC, which slid $2.24, or nearly 17 percent, to $11.21 after recording a loss of 12 cents a share, 7 cents wider than analysts had anticipated.

After the market closed, Apple Computer said fiscal fourth-quarter profit fell as sales declined. Net income was $66 million, or 19 cents a share. Analysts were expecting 16 cents a shares. Sales were $1.45 billion.

On the economic front, housing construction rose 1.7 percent in September, rebounding from a 6.7 percent decline in August.

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