NEW YORK >> The stock market greeted news of U.S. military attacks on the Taliban in Afghanistan quietly today, with prices falling moderately as investors tried to discern what the action would mean for the country and the economy.
Stocks mixed in wake
of U.S. retaliation
By Amy Baldwin
While tech shares eked out a tiny gain, investors mostly locked in profits from last week's rally.
The market was worried that the United States will suffer more terrorism after American and British forces conducted a second day of missile attacks in Afghanistan, retaliating for the Sept. 11 terrorist assaults. Investors are also concerned about how long and how much the weakened economy will suffer following the attacks.
The Dow Jones industrial average closed down 51.83 at 9,067.94, after having risen 272.21, or 3.1 percent, last week. The broader market finished mixed. The Nasdaq composite index inched up 0.65 to 1,605.95 to just barely claim its first five-session winning streak since the week of June 25. Last week, the tech-focused index rose 106.50, or 7.1 percent.
The Standard & Poor's 500 index, Wall Street's widest measure, fell 8.94 to 1,062.44.
Decliners outnumbered advancers more than 3 to 2 on the New York Stock Exchange, with 1,897 down, 1,173 up and 219 unchanged. Volume was 966.65 million shares vs. 1.31 billion shares traded Friday. The NYSE composite index fell 5.24 to 549.16, the American Stock Exchange composite index fell 3.15 to 830.13 and the Russell 2000 index fell 2.80 to 412.17.
Today's mild pullback was expected given the political uncertainty and last week's rally, spurred by the Federal Reserve's ninth interest rate cut of the year and a push by President Bush for an economic stimulus package worth $60 billion.
The bond market was closed for the Columbus Day federal holiday.
"The market is attempting to stabilize," said Alan Ackerman, executive vice president of Fahnestock & Co.
Analysts were also encouraged by the Nasdaq's narrow gain and that blue-chip selling wasn't greater.
"Markets have historically recovered from catastrophes with a decent relief rally. It appears we are in one of those right now," Ackerman said.
Trading volume was lighter than normal, which could be attributed partly to traders' caution, as well as the holiday. There also were no major third-quarter earnings reports due to be released.
"This is a combination of things. There is some concern on the part of some investors about the retaliation. There is also some ordinary profit taking from the extraordinary strong run," said Bill Barker, investment strategy consultant for Dain Rauscher in Dallas, who also noted the holiday.
Blue-chip losers included the nation's three big automakers, trading lower on a report in the Financial Times that Ford Motor, General Motors and DaimlerChrysler are slashing pro- duction by a further 196,000 vehicles before the end of the year.