Stocks slide again Friday, giving Dow worst-ever weekly point drop
Saturday, March 17th 2001, 12:00 am
By: News On 6
NEW YORK (AP) _ Blue chip stocks capped their worst-ever weekly point drop and biggest percentage loss in more than 11 years Friday amid pessimism that the economy and corporate profits will be able to rebound this year.
Not even hopes for a big interest rate cut by the Federal Reserve on Tuesday could ease the pain.
The Dow Jones industrial average tumbled 207.87, or 2.1 percent, to 9,823.41.
The Nasdaq composite index fell 49.80, or 2.57 percent, to 1,890.91, and the Standard & Poor's 500 fell 23.03, or 2 percent, to 1,150.53.
The week's statistics, which included a 436-point slide in the Dow on Monday and another 317-point drop Wednesday, attest to the gloom that pervades Wall Street:
_The Dow lost 821.21, eclipsing the 805.71 the blue chips lost during the week ended April 14, 2000. The Dow's 7.71 percent slide for the week was its biggest since it lost 7.76 percent the week ended Oct. 13, 1989, but it was only 44th on the index's list of worst weekly percentage declines.
The blue chips have fallen 16.2 percent since peaking at 11,722.98 on Jan. 14, 2000.
_The Nasdaq fell 161.87 or nearly 7.9 percent for the week, leaving the index 62.5 percent below its peak of 5,048.62 on March 10, 2000. The Nasdaq is also at its lowest close since Nov. 17, 1998.
_The S&P 500 fell 82.89 or 6.72 percent for the week. It has lost a quarter of its value from its high of 1,527.46 a year ago.
_The declines brought the Dow below 10,000 for the first time in 27 months and pulled the Nasdaq under 2,000 for the first time since October.
_The selling sliced $772.36 billion from the total value of U.S. stocks, according to Wilshire Associates of Santa Monica, Calif.
``We're having a confidence crisis, not an economic one,'' said Alfred E. Goldman, director of market analysis at A.G. Edwards & Sons Inc., a St. Louis-based brokerage. ``There's a lot of extreme pessimism in the market now, and that's the kind of attitude you see when the market is near a bottom.''
Others, however, were more reluctant to say whether the bout of selling is nearing an end.
``If one cannot assess where the bottom is, it's best to sit on the sidelines,'' said Alan Ackerman, senior vice president at Fahnestock & Co. ``Cash is king.''
Friday's sell-off was triggered by the latest warning from a bellwether tech company. Compaq Computer said late Thursday its first-quarter results will fall short of Wall Street's expectations and it will cut 5,000 jobs _ about 7 percent of its work force.
Compaq's stock was off 50 cents at $18, and other major tech shares also fell.
Oracle fell a day after announcing it had met lowered earnings expectations and anticipated poor demand for at least three more quarters. Oracle was off 63 cents at $14.06 in heavy trading.
Wall Street was further disheartened by news from the Federal Reserve that industrial production plunged for the fifth month in a row. Output at the nation's factories, mines and utilities fell by 0.6 percent last month, more than expected.
News earlier this week of worsening economic problems in Japan also helped send stocks sharply lower. Wall Street feared U.S. companies, already suffering from a slowdown in this country, will be further hurt by economic weakness overseas.
Hopes for an aggressive interest rate cut of three-quarters of a percentage point helped to temper pessimism this week. But a report Friday that a University of Michigan survey showed an increase in consumer confidence in February led some to question how aggressively the Fed will ease credit when it meets Tuesday.
Declining issues outpaced advancing ones on the New York Stock Exchange, where volume came to 1.54 billion shares, well above Thursday's pace.
Friday was what's called a triple witching day, when option contracts and futures contracts expire. On such days, the market typically sees heavy volume and price volatility.
Overseas markets were mixed. Japan's Nikkei stock average rose 0.66 percent, but European markets fell.