NEW YORK -- Investors worried about an impending earnings report from Intel drove down stocks to their lowest levels in months. For the second time in four sessions, the Dow Jones industrial average came close to falling below 10,000, but a late rally mitigated the damage.
Dow loses 149
The Dow closed down 149.01, or 1.5 percent, at 10,089.71, after dropping more than 200 points earlier in the session. The Nasdaq composite index fell 76.32, or 2.3 percent, at 3,213.96. The Standard and Poor's 500 index dropped 24.65, or 1.8 percent, to 1,349.97. The Russell 2000 index fell 10.87 to 470.88. Decliners beat advancers by a more than 3-to-1 ratio on the New York Stock Exchange, with 2,110 down, 818 up and 498 unchanged. NYSE volume came to 1.16 billion shares, ahead of the 998.73 million reported yesterday, according to preliminary figures.
The price of the Treasury's 10-year note was up 14/32 point, or $4.38 per $1,000 in face value, at midday; its yield fell to 5.67 percent from 5.73 percent late yesterday. Prices and yields move in opposite directions. The 30-year bonds were up 19/32 point and yielded 5.76 percent, down from 5.81 percent late yesterday.
Concerns that Intel's results, which came out after the market's close, would be disappointing sparked a selloff of other chip makers. Investors then moved on to Internet stocks; America Online, Amazon.com and Yahoo! all fell to 52-week lows on concerns that their growth was slowing and earnings would fall short.
After the market closed, IBM reported earnings in line with expectations. The stock ended regular trading up $1.88 at $113.
"The mood of the market clearly is the one of despair at this point," said Kevin Caron, an associate strategist at Gruntal & Co., who believes earnings overall will be healthy.
Investors weren't as optimistic. Micron Technology fell $5 to $28.69 after Paine Webber cut its rating to "attractive" from "buy."