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Dow dives 165
Bloomberg NewsNEW YORK -- U.S. stocks fell for the first time in five days as investors concluded the Federal Reserve will boost interest rates further in coming months, crimping corporate profit growth even as it keeps inflation in check.
The Dow Jones industrial average dropped 164.83, or 1.5 percent, to close at 10,769.74, led by Hewlett-Packard Co. The Nasdaq composite index slid 72.61, or 1.95 percent, to 3,644.96, after rising 9.8 percent the past four sessions. The S&P 500 fell 18.24, or 1.2 percent, to 1447.50. Decliners beat advancers a nearly 2-to-1 margin on the New York Stock Exchange, with 996 up, 1,885 down and 500 unchanged. NYSE volume totaled 824.64 million shares vs. 951.59 million yesterday. The NYSE composite index fell 7.85 to 650.98; the American Stock Exchange composite index lost 5.51 to 935.09; and the Russell 2000 index dropped 6.32 points to 499.66.
Treasury securities fell, also on concern that the Fed may follow yesterday's half-point interest-rate rise with more increases to contain inflation. The 10-year Treasury note fell , or $3.75 per $1,000 face amount, pushing its yield up 6 basis points to 6.48 percent. The 30-year bond price fell 31/32 point, or $9.69, as its yield climbed 7 basis points to 6.18 percent. The two-year note fell 1/32 point, or 31 cents, as its yield rose 2 basis points to 6.89 percent. The Fed next meets June 28.
On Wall Street, Cisco Systems Inc. and Microsoft Corp. led the S&P 500 lower after rallying early this week. AT&T Corp. declined after Jack Grubman, an analyst at Salomon Smith Barney, cut his earnings estimate and stock-price forecast.