The Dow Suffers Biggest Point Loss Evergreenspun.com : LUSENET : Grassroots Information Coordination Center (GICC) : One Thread
Friday April 14 4:45 PM ET
The Dow Suffers Biggest Point Loss Ever
NEW YORK (Reuters) - U.S. stock prices plunged Friday in a crushing across-the-board selloff that left the Dow Jones industrial average with its worst one-day point loss ever and drove the Nasdaq market down almost 10 percent as higher-than-expected inflation numbers traumatized Wall Street.
The pounding left the market values of companies in almost every industry reeling as the momentum of a month-long decline in technology issues was stoked by concern that borrowing costs are going to be jacked up further.
``The loathing and trepidation has gone very rapidly from zero to 110 percent,'' said Scott Bleier, chief investment strategist at Prime Charter Ltd.
Based on early and unofficial closing figures, the technology-dominated Nasdaq composite index (^IXIC - news), dropped 355.10 points, or 9.66 percent, to 3.321.68, its worst single-day point drop ever and leaving it with a loss for the week of 1,126.5 points.
It is now down 34.2 percent from its all-time high close of 5,048.62 -- putting it well into bear territory, which is defined as a drop of more than 20 percent from the record.
The blue chip Dow Jones Industrial Average (^DJI - news) plummeted 616.23 points, or 5.64 percent, to 10,307.32, also its worst one-day point loss ever. It fell 7.2 percent for the week.
Figures showing much higher than expected inflation for March heightened fears that the Federal Reserve will boost short-term interest rates aggressively in mid-May. That further darkened the mood of already pessimistic investors, some of whom have been forced to sell in recent days to meet margin calls on borrowed funds from brokers and annual tax payments.
``The Nasdaq was rocky to begin with and it didn't take much to upset the apple cart,'' said Peter Coolidge, senior equity more than 805.9 million shares.
``I suspect a lot further on the downside,'' said Alan Newman, technical analyst at H.D. Brous & Co. ``Over the short term I would expect some kind of bottom next week. We just cannot keep on going down at the same rate everyday.''
Financial services stocks in the Dow suffered the most, with American Express (NYSE:AXP - news) down 12 9/16 to 133 7/16 and J.P. Morgan (NYSE:JPM - news) off 9 1/2 to 122.
The Standard & Poor's 500-stock index (^SPX - news) lost 82.93 points, or 5.76 percent, to 1,357.58.
``The market got carried away to the extreme on the upside and now it is going to get carried away to the extreme on the downside,'' said Larry Rice, chief investment officer at Josephthal Lyon & Ross. ``The Dow coming down does not surprise me because it has been going up like a rocket ship in the past few weeks.''
-- Carl Jenkins (Somewherepress@aol.com), April 14, 2000