Dow drops 379 points as Mideast turmoil escalates


Associated Press

NEW YORK — The Dow Jones industrial average plunged 379 points Thursday, nearly dropping below 10,000, as new Mideast violence and soaring oil prices compounded worries about weak company profits.

The Nasdaq composite index fell to its lowest close this year, extending a post-Labor Day slide dominated by fears that technology companies aren’t growing fast enough to justify lofty stock prices.

Home Depot led the Dow’s decline after the retailer became the latest blue chip company to warn it would not meet third-quarter expectations.

The Dow closed down 379.21 at 10,034.58, the lowest it’s been since March. It was its fifth-largest point drop ever, but the 3.6 percent decline did not even approach the top 25 percentage losses.

Broader markets also fell. The Nasdaq composite closed down 93.81 to 3,074.68, its lowest close of 2000. The Standard &amp Poor’s 500 index tumbled 34.81 to 1,329.78.

"In an already nervous market, this is all we didn’t need," said Al Goldman, an analyst with A.G. Edwards &amp Sons Inc. in St. Louis. "A terrorist attack, increased hostilities in the Middle East and a spike in oil prices. Shake it all up and you get blind dumping of stocks."

Oil prices reached $37.00 a barrel at one point on the New York Mercantile Exchange, nearing its recent 10-year high of $37.80 a barrel. Crude futures closed Thursday at $36.06, up $2.81.

Meanwhile, shares of Home Depot, the nation’s largest home improvement retailer, tumbled $13.81, or 28 percent, to $35.13 after it warned Thursday of lower-than-expected earnings, primarily because of material costs.

The news sent other retailers down as well, including Wal-Mart, while financial stocks also suffered.

Fears that higher oil costs would hurt airlines sent Continental Airlines down $2.75 at $41.19. Boeing fell $4.06 to $56.13.

Declining issues outnumbered advancers by more than 3 to 1 on the New York Stock Exchange. Consolidated volume came to 1.67 billion shares, slightly ahead of the 1.66 billion shares in Wednesday’s session.

The Russell 2000 index was down 11.77 at 462.97.

Overseas, Japan’s Nikkei stock average rose 0.24 percent. Germany’s DAX index was down 1.47 percent, Britain’s FT-SE 100 rose 0.23 percent, and France’s CAC-40 was up 0.58 percent.

Copyright ©2000 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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