NEW YORK >> Capping a dreary first quarter, Wall Street suffered another sharp drop today, depressed by fears of prolonged fighting in Iraq and a disappointing report on the state of manufacturing in the Midwest. The Dow Jones industrials slid more than 150 points in the market's fourth straight declining session. Dow falls as fears grow
of prolonged Iraq warBy Amy Baldwin
Associated PressThe Dow and Standard & Poor's 500 index ended the first three months of 2003 with substantial losses, while the Nasdaq composite index, which had fallen the most in the bear market, eked out a modest gain. The month of March, however, turned out to be positive for all three indexes.
Analysts said investors are concerned that the war will last for several months rather than a few weeks. Investors believe that the longer the fighting lasts, the more conservative businesses and consumers will become in their spending, a threat to an already troubled economy.
The market's glum mood was also due to developments in the war over the weekend, including a suicide attack that killed four American soldiers on Saturday.
"It is just hard to find buyers. Not a lot of people are willing to step up to the plate," said Bryan Piskorowski, market commentator for Prudential Securities. "For the most part, it is all Iraq all the time, but you also have soft economic data ahead of quarterly earnings warnings. That triumvirate is hard to overcome here."
The Dow closed out today's trading down 153.64, or 1.9 percent, at 7,992.13, according to preliminary calculations. The Dow amassed a four-day loss of 288.10. The broader market was also sharply lower. The Nasdaq composite index sank 28.82, or 2.1 percent, to 1,340.78. The Standard & Poor's 500 index fell 15.38, or 1.8 percent, to 848.12.
Declining issues outnumbered advancers more than 4 to 3 on the New York Stock Exchange. Trading was light as it has been for weeks.
The Russell 2000 index, which tracks smaller company stocks, fell 4.16, or 1.1 percent, to 364.54.
But some optimism earlier in the month, when investors sent stocks rallying on the belief that war would be short, enabled the indexes to end the month with gains. The Dow rose 1.3 percent, the Nasdaq advanced 0.3 percent and the S&P increased 0.8 percent.
Stocks finished the first quarter mostly lower. The Dow gave up 4.2 percent and the S&P shed 3.6 percent, although the Nasdaq gained 0.4 percent.
Today's economic news was a big blow to the market. The Purchasing Management Association of Chicago reported that its index of business activity fell to 48.4 in March on a seasonally adjusted basis from 54.9 in February. Not only was the reading much weaker than economists predicted, but because it was below 50, it indicated a contraction in business activity.
The index is considered a harbinger of the Institute for Supply Management's national survey on manufacturing, due to be released tomorrow.
Overseas, Japan's Nikkei stock average finished today down 3.7 percent. In Europe, France's CAC-40 dropped 4.2 percent, Britain's FTSE 100 fell 2.6 percent and Germany's DAX index slid 3.9 percent.
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