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NEW YORK >> Wall Street pulled back today after investors' elation about a quick end to the war with Iraq dissolved into concerns about corporate profits. Stocks tumbled sharply with the Dow Jones industrials forfeiting 100 points. Stocks tumble despite
military advance in IraqBy Amy Baldwin
Associated Press"The market has been absolutely thrilled about an imminent end for arguably (these) first three weeks of the war. We started the stock rally before the war started," said Arthur Hogan, chief market analyst at Jefferies & Co. "Unfortunately, when investors stop celebrating they will have to focus on corporate profits, which may not be so jubilant," he said.
Declining issues had a narrow lead over advancers on the New York Stock Exchange. Volume was light. The Dow closed down 100.98, or 1.2 percent, at 8,197.94.
The broader market was also lower. The Nasdaq composite index dropped 26.20, or 1.9 percent, to 1,356.74. The Standard & Poor's 500 index fell 12.30, or 1.4 percent, to 865.99. The Russell 2000 index fell 2.38, or 0.6 percent, to 372.28.
The price of the Treasury's 10-year note was up 11/32 point, while its yield fell to 3.89 percent from 3.94 percent yesterday. The price of two-year Treasury notes was up 1/16 point and its yield fell to 1.52 percent from 1.56 percent yesterday.
Wall Street welcomed news from the U.S. military that Saddam Hussein's government is no longer in control of Baghdad. But the market's ability to advance was impeded by first-quarter earnings, which companies began releasing this week. Profits are expected to be mostly disappointing, due to the detrimental effect of the war on the economy and in turn, corporate performance.
"For weeks, the only game in town was Iraq. We have gotten to the point where it is not over but in the last quarter. Investors are now looking for the next thing that will drive the market," said Chris Johnson, manager of quantitative analysis at Schaeffer's Investment Research in Cincinnati. "The economy is still not good. For the past few weeks, we were able to ignore that as the market focused on success in Iraq."
While investors will likely send certain shares lower when first-quarter earnings disappoint them, stocks are more vulnerable to weak predictions about the second quarter.
"The market needs to hear that the next quarter is it," said Johnson, referring to a return to profitability. "Unfortunately, the current events in the market are going to keep that from happening."
Decliners included Yahoo!, which dropped 94 cents to $22.87 ahead of the Internet company's release of its quarterly earnings report later today.
Knight Ridder fell $1.55 to $58.81 after the newspaper publisher reported quarterly profits that fell short of estimates.
Nationwide Health advanced 33 cents to $13.85 after Prudential Securities raised its recommendation on the company to "buy" from "hold."
Overseas, Japan's Nikkei stock average finished down 0.9 percent. In Europe, France's CAC-40 and Britain's FTSE 100 each declined 0.2 percent, while Germany's DAX index fell 1.2 percent.
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