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Dow briefly
breaches 10,000
The index ends down 133 to close
Bloomberg News
above the benchmark while the
Nasdaq hits a recordNEW YORK -- The Dow Jones industrial average tumbled today, dipping below 10,000 for the first time since October, as investors sold consumer, financial and industrial shares on concern rising interest rates will crimp corporate profits.
The Dow dropped 133.10, or 1.3 percent, to 10,092.63, after falling to 10,000 or lower four times and rebounding. The last time it traded that low was Oct. 18. Its last close below that milestone was April 6, at 9,963.49. American Express Co. led today's the sell-off.
But the Nasdaq composite index, whose computer-related and telecommunications stocks have gained even as rates have risen since June, climbed toward its 11th record this year. The Nasdaq rose 67.32, or 1.48 percent, to 4,617.65, its second consecutive record close. Intel Corp. led today's Nasdaq gained.
The Nasdaq is now up 13.5 percent so far in 2000, while the Dow is down 12.2 percent year to date.
The Standard & Poor's 500 index fell 7.26 to close at 1,353.43, led by Cisco Systems Inc.
More than two stocks fell for every one that rose on the New York Stock Exchange, with 1,997 down, 1,035 up and 452 unchanged. Today was the ninth time in 10 days more stocks have declined than advanced. NYSE volume totaled 1.17 billion shares vs. 979.74 million yesterday.
The NYSE composite lost 5.06 to 583.87; the American Stock Exchange rose .63 to 935.62; and the Russell 2000 index of smaller companies rose 4.13 to 554.04.
The price of the Treasury's main 30-year bond slipped 4/32 point, or $1.25 per $1,000 in face value; its yield rose to 6.14 percent from 6.12 percent yesterday.
Stock analysts said interest rate fears continued to hurt blue chip stocks. "People are focused on higher rates and voting with their feet," said Edmund Cowart, a fund manager at Eagle Asset Management Inc., which oversees $7 billion in St. Petersburg, Fla.
Federal Reserve Chairman Alan Greenspan told the Senate Banking Committee yesterday that rates will have to rise to cool the economy and keep inflation in check. His testimony repeated remarks to the House last week that sent stocks tumbling on Friday.
But many high-tech shares seem immune to the rate fears. Intel rose $5.19 to $114.25 after Robertson Stephens analyst Dan Niles said the stock could reach $150 before the end of the year, up from his previous estimate of $125.
"The areas that appear to be in vogue are things like chips and the Internet, and you're not going to get a better-quality chip company than Intel," said Phil Orlando, chief investment officer at Value Line Asset Management Inc. Orlando holds 125,000 Intel shares in the portfolio he manages.
Niles said Intel will benefit as Microsoft Corp.'s new Windows 2000 operating system drives businesses to buy more powerful computers that use Intel's higher-priced Pentium III processor.
Priceline.com rose after it hired one of America's most powerful businesswomen from Citigroup Inc. The Internet site that allows consumers to bid on plane tickets, hotel rooms and other goods said it hired Citigroup executive Heidi Miller as chief financial officer. In 1999, Fortune magazine named Miller the second most-powerful U.S. businesswoman.