Turmoil Rocks Global Markets NewsMax.com Friday, Oct. 13, 2000 Oil prices hit 10-year highs. Investors scurried from stocks into the safety of government bonds. Could violence in the Middle East derail America's economic boom? Reuters news service was reporting Thursday that:

 The blue-chip Dow Jones industrial average fell 379 points to 10,034, its fifth-largest point drop ever.

 The technology-laden Nasdaq composite index slumped 3 percent to 3,074  its lowest in 11 months.

 "It's pure fear of uncertainty," said Milton Ezrati, a strategist at Lord, Abbett & Co., which manages more than $40 billion in funds. "Markets already were on a downswing before the Middle East eruption. This will go on."

 Rattled investors yanked money from American stocks and rushed into government money markets, searching for guaranteed return amid the chaos.

 Prices jumped in shorter-dated Treasuries, pushing the yield on two-year notes down to 5.85 percent  their lowest since last November.

 "It's nuts," said one bond trader." And another bemoaned, "The world's a dangerous place. We have a fear trade going on."

 An increased number of investors were in pursuit of the Swiss franc, historically a safe port in times of trouble, pushing it to record highs against the euro at 1.5035 francs.

 The yen also strengthened, as Japanese investors alarmed by the global upheaval pulled some of their sizable foreign holdings back to the home islands.

 Amid fears that violence would erupt in other Arab nations and oil supply lines would be cut, the price of crude oil in London shot above $35 a barrel for the first time since 1990.

 The NYMEX crude futures in New York exploded to $37, up more than $2 during the day, before settling at $36.06.

 In turn, the oil-price surge compounded problems in equity markets, where a slowing United States economy and the faltering European single currency were hurting profits at American companies.

 Several major U.S. firms were issuing warnings that their profits would not be as good as previously expected.

 "This is a market not in a strong enough state to handle bad news," said Ed Peters, chief investment strategist at PanAgora Asset Management Inc.

http://www.newsmax.com/articles/?a=2000/10/13/91140

-- Martin Thompson (mthom1927@aol.com), October 14, 2000