NEW YORK >> The Dow Jones industrials tumbled more than 180 points today on word of a troubled merger between Honeywell and General Electic and the latest indications that a business turnaround might not occur in 2001. Wall Street continues
to unravelAssociated Press
Analysts said a barrage of second-quarter earnings warnings have unnerved investors, who now fear this spring's huge rally may have come too soon. A profit warning after the market closed from tech bellwether JDS Uniphase did little to suggest that sentiment would improve anytime soon.
"There's no good news on the earnings and economic fronts right now," said John Forelli, portfolio manager for the John Hancock Core Value Fund. "The hopes and dreams of a fourth-quarter recovery is being put in question as each day goes on."
The Dow Jones closed down 181.49 at 10,690.13, for a loss of 1.7 percent, recovering from a loss of 212 points. The Standard & Poor's 500 index fell 21.73, or 1.8 percent, to 1,219.87, and the Nasdaq composite index fell 77.59 to 2,044.07, a decline of 3.7 percent. Decliners trounced advancers on the New York Stock Exchange, with 2,153 down, 923 up and 192 unchanged. Volume was 1.22 billion shares vs. 1.06 billion yesterday. The NYSE composite index fell 8.76 to 623.96, the American Stock Exchange composite index lost 13.44 to 921.88 and the Russell 2000 index fell 9.74 to 495.38. The Treasury's 10-year note fell 1/4 to 98 9/32; its yield fell 4 basis points to 5.23 percent. The 30-year bond rose 9/32 to 96 6/32; its yield fell 2 basis points to 5.64 percent.
Three new economic reports did little to suggest the business climate is improving.
The Labor Department's Producer Price Index, which measures inflation pressures before they reach store shelves, crept up a seasonally adjusted 0.1 percent last month, following a modest 0.3 percent increase in April.
In another Labor Department report, the number of Americans filing new claims for state unemployment benefits fell by a seasonally adjusted 12,000 last week to 428,000, but monthly figures remain high -- more evidence that employers continue to lay off employees. Finally, a Commerce Department report showed businesses' inventories of unsold goods were flat in April, while sales fell by 0.5 percent.