- The Washington Times - Thursday, August 30, 2001

NEW YORK (AP) Investors sent stocks tumbling yesterday for a third straight session on a government report showing the economy eked out only a slim gain in the second quarter, its weakest performance in eight years.
While the economy fared better than expected some analysts had feared it would be flat or even decline investors weren't comforted. After weeks of dismal earnings and negative forecasts from the nation's biggest companies, Wall Street took the report on the gross domestic product as just another reason not to buy.
"There is no faith that things are about to improve anytime soon," said Richard E. Cripps, chief market strategist for Legg Mason of Baltimore.
The Dow Jones Industrial Average closed down 131.13 at 10,090.90, giving it a decline of 332 points, or 3.2 percent, so far this week. Once again, the blue-chip index finished at levels last seen in early April.
The broader market was also lower with the Nasdaq Composite Index falling 21.81 to 1,843.17, bringing its three-day loss to 73.63, or 3.8 percent. The Standard & Poor's 500 index fell 12.91 to 1,148.60, giving it a drop of 36.33, or 3 percent, so far this week.
Investors were clearly disappointed by the Commerce Department's report that the GDP the country's total output of goods and services inched up just 0.2 percent in the April-June quarter.
The resulting selling was spread across the market as frustrated investors stayed away from stocks on worries that business would remain weak for the immediate future.
Caterpillar fell 97 cents to $51.17, while Gap slipped 60 cents to $19.70 after Banc of America Securities reduced its rating on the retailing stock.
Pessimistic outlooks from two technology bellwethers intensified the market's bad mood.
Chip stocks slipped after Advanced Micro Devices warned that revenue in the current quarter would likely fall about 15 percent from the last quarter, compared with previous projections of 10 percent to 15 percent losses. AMD fell 66 cents to $14.20, a 4 percent loss.
Networking stock Nortel Networks fell 25 cents to $6.52 after WorldCom announced that it would cut its 2002 capital spending to $6 billion. WorldCom, which fell 53 cents to $12.44, is one of Nortel's most important customers.
Also yesterday, Microsoft lost 45 cents to $60.29 on news that the Justice Department had asked the new judge in its antitrust case against the software company to discuss a schedule for moving the case along.
There were a few modest winners. Among them was Gateway, which inched up 19 cents to $8.79 after announcing a restructuring plan late Tuesday. The computer maker plans to cut 25 percent of its global work force and shutter operations in Asia.
But analysts said yesterday's session mostly reflected the ambivalence that has come to characterize Wall Street amid unending indications of weak business and a struggling economy.
Declining issues outnumbered advancers nearly 4-to-3 on the New York Stock Exchange. Consolidated volume came to 1.17 billion shares, compared with 1.18 billion Tuesday.


Copyright © 2018 The Washington Times, LLC. Click here for reprint permission.

The Washington Times Comment Policy

The Washington Times welcomes your comments on Spot.im, our third-party provider. Please read our Comment Policy before commenting.

 

Click to Read More and View Comments

Click to Hide