- The Washington Times - Tuesday, October 8, 2002

NEW YORK (AP) Unnerved by a profit warning from Sears, investors sold stocks for a fourth straight session yesterday and extended six weeks of sell-offs on Wall Street.
Investors also were uneasy in light of a shutdown of the nation's West Coast ports and the possibility of war with Iraq. Selling accelerated in the final hour of trading, with the Dow Jones industrials dropping more than 100 points, their second straight triple-digit loss.
"There is just no good news to trigger anybody's enthusiasm to buy stocks," said Bill Barker, investment strategy consultant at RBC Dain Rauscher in Dallas.
The Dow closed down 105.56, or 1.4 percent, at 7,422.84, for a four-day loss of 515.95. The Dow is near a five-year low, its weakest finish since Nov. 12, 1997, when it stood at 7,401.30.
The market's broader gauges also stumbled for a fourth day. The Nasdaq Composite Index fell 20.50, or 1.8 percent, to 1,119.40, having closed last week at a six-year low. Monday's slippage made for a four-day loss of 94.32 and a new six-year low. The Nasdaq last finished lower on Aug. 1, 1996, when it stood at 1,098.85.
The Standard & Poor's 500 index declined 15.30, or 1.9 percent, to 785.28, falling to a four-day loss of 62.63. The Russell 2000 index, the barometer of smaller company stocks, fell 9.69, or 2.8 percent, to 338.29.
The three market indicators have endured six consecutive weekly declines, largely due to decreased expectations for third-quarter earnings results that companies will release over the next few weeks.
Investors continue to have reasons to doubt the strength of the economy. The latest worry has to do with a labor dispute that has shut down 29 West Coast ports. Yesterday, President Bush announced he was forming a board of inquiry to determine whether the sides are negotiating in good faith, a first step before he could order an 80-day cooling-off period that would force longshoremen back to work.
Much of this year's selling can be attributed to the economy. Investors have been alternating between being displeased by a slow-paced recovery and fearful that the economy would slip back into recession.
"There's a modest [economic] recovery that traders can't get too excited about in the here and now," said Kevin Caron, market strategist, Ryan, Beck & Co., LLC.
The market has also been anxious about the possibility of war with Iraq. Bush was scheduled to address the nation during a prime-time televised speech last night about Iraq and the possibility of war.
Sears dropped $5.39, or 14.3 percent, to $32.25 after issuing a profit warning for the third quarter.
"We continue to get [warnings] in every sector. It is not just technology. It is a rough time," Mr. Barker said.
Brokerage downgrades pressured other stocks.
United Parcel Service fell $2.25 to $59.35 and FedEx stumbled $2.01 to $49.05 after Morgan Stanley downgraded the two companies.
Cisco Systems fell 38 cents to $9.08 after Goldman Sachs lowered its earnings estimates for the networking company.
Among yesterday's winners, Adolph Coors rose $1.54 to $58.88 after Morgan Stanley upgraded the brewing company.
Intel advanced 11 cents to $13.82 after CEO Craig Barrett said he expects the chip industry to rebound early next year.
Declining issues outnumbered advancers nearly 4-to-1 on the New York Stock Exchange. Volume was light at 1.55 billion shares.
Overseas markets were lower yesterday, with Japan's Nikkei stock average closing down 3.8 percent. In Europe, France's CAC-40 fell 1.2 percent. Also Britain's FTSE 100 declined 0.9 percent, and Germany's DAX index lost 1.7 percent.


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