Dow has week’s
fourth triple-digit loss

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By Amy Baldwin
Associated Press

NEW YORK >> Conflicting economic reports frustrated investors today, prompting them to bail further out of the stock market. The Dow Jones industrial average plunged as much as 201 points before trimming its loss to 117, its fourth triple-digit drop in five sessions.

Selling accelerated by late afternoon, causing the technology sector to fall after having enjoyed a solid advance earlier in the day.

Investors were shaken by a drop in a measure of consumer confidence and a downgrade of Home Depot. As trading wore on, they were less soothed by positive forecasts from Dell Computer and General Electric.

"What the market is saying is: Be very defensive," said Gary Kaltbaum, market technician for Investors' Edge Partners in Orlando, Fla.

Trading was volatile, especially for the Dow, which swung from a gain of 47 points to a loss of 201. Declining issues outnumbered advancers nearly 3 to 2 on the New York Stock Exchange. Volume was relatively heavy.

The Dow closed down 117.00, or 1.3 percent, at 8,684.53. It ended the week with four triple-digit declines and not one winning session. Its total loss: 694.97, or 7.4 percent.

The market's broader indicators also fell today. The Nasdaq composite index slipped 0.93 to 1,373.50. Earlier today, the Nasdaq rose as much as 28.

The Standard & Poor's 500 index fell 5.98, or 0.6 percent, to 921.39. The Russell 2000 index, which tracks smaller company stocks, fell 3.40, or 0.8 percent, to 413.28.

The price of the Treasury's 10-year note was up 13/32 point today, while its yield fell to 4.58 percent from 4.63 percent yesterday. The price of two-year Treasury notes rose 3/32, while while yields were at 2.53 percent, down from 2.58 percent late yesterday.

Analysts attributed the fluctuations to a program trading in which computers generate "buy" orders when stocks fall to a specified level and "sell" orders when stocks rise. There was no fundamental change in market sentiment to drive the selling.

"The tone is still bearish," said Larry Wachtel, market analyst at Prudential Securities.

Flogged by investors' persistent worries about corporate accounting and the strength of earnings, the market's indexes suffered their eighth straight losing week.

Investors were disappointed by news about consumers, whose spending accounts for two-thirds of the economy. The University of Michigan's consumer sentiment index for mid-July registered a reading of 86.5, down from 92.4 in June.

That drop in consumer sentiment overshadowed a positive report from the Commerce Department, which said that retail sales rose 1.1 percent in June, better than the 0.7 percent increase analysts had forecast. Analysts said that the market is more concerned about how investors are feeling now, rather than how much they spent last month.

Retailing shares fell sharply. Kohl's sank $2.21 to $66.99, while Wal-Mart stumbled $1.33 to $52.85.

And Dow industrial Home Depot fell $2.31 to $29.09 after Merrill Lynch downgraded the stock to "neutral" from "strong buy," citing weak sales and depleted inventories.

Accounting worries continued to plague Wall Street. Duke Energy dropped $3.20 to $24.75, on news that it has received subpoenas from the Commodity Futures Trading Commission and the Houston office of the U.S. attorney for information related to its trading activities.

There were some winners, however. Dell rose $1.09 to $25.02 after raising its second-quarter earnings and revenue estimates.

And Dow industrial GE advanced $1.25 to $28.60 after reaffirming its outlook for the year and meeting second-quarter expectations.

Overseas, Japan's Nikkei stock average finished up 1.1 percent. In Europe, France's CAC-40 inched up 0.04 percent, Britain's FTSE 100 slipped 0.1 percent, and Germany's DAX index rose 0.3 percent.