Dow Ends Down 64; Nasdaq Drops 98
Tuesday, July 18th 2000, 12:00 am
By: News On 6
NEW YORK (AP) â€” Stocks slumped Tuesday as investors locked in some gains from the technology rebound despite some strong profit reports by major companies and a mostly unsurprising inflation report.
According to preliminary calculations, the Dow Jones industrial average fell 64.35 to close at 10,739.92 after falling as much as 101 points during the session.
Among broader market indicators, the Nasdaq composite index fell 97.73 to 4,176.94, the Standard & Poor's 500 fell 16.75 to 1,493.74, and the Russell 2000 index of smaller companies fell 8.90 to 536.28.
Declining issues outnumbered advancers by about a 3-to-2 margin on the New York Stock Exchange and the Nasdaq Stock Market. NYSE volume came to 905.34 million shares as of 4 p.m., almost even with Monday's tally of 900.37 million.
Before the open, the Labor Department reported that consumer inflation jumped 0.6 percent in June, chiefly reflecting surging gasoline prices and a record rise in the cost of natural gas.
Most other prices posted modest increases. June's performance, which was close to the 0.5 percent rise in consumer prices many analysts were expecting, was the largest increase since March.
The Federal Reserve has boosted interest rates six times over the past 13 months to slow economic growth and keep inflation in check. With recent reports suggesting that the Fed's rate increases are working, some economists believe the central bank will leave rates unchanged at its meeting Aug. 22.
Merrill Lynch, General Motors and Johnson & Johnson led the morning parade of reports on second-quarter profits with better-than-expected results. However, the day's most anxiously awaited reports, from Intel and Microsoft, weren't due until after the close.
Among other leading companies, Honeywell and Philip Morris matched most Wall Street profit forecasts.
On a more discouraging note, Unisys tumbled 22 percent after the struggling computer systems company posted disappointing results.
Health insurance stocks fell sharply after Aetna issued a warning that its second-quarter results would come in well below analysts' expectations. Shares of Aetna fell more than 10 percent.
Overseas, Japan's Nikkei stock average fell 1.98 percent, Germany's DAX index fell 0.32 percent, Britain's FT-SE 100 fell 1.15 percent, and France's CAC-40 fell 1.58 percent.