Investors give mixed reaction to military strikes

By Amy Baldwin

Associated Press

NEW YORK – The stock market slipped slightly today as investors reacted to news of the U.S. military attacks in Afghanistan.

The Dow Jones industrial average closed down 51.76 points at 9,068.01, according to preliminary calculations. The technology-heavy Nasdaq composite index inched up 0.67 to 1,605.97. The Standard &Poor’s 500 index, Wall Street’s widest measure, fell 8.94 to 1,062.44.

Today’s mild pullback was expected given the political uncertainty and last week’s rally, spurred by the Federal Reserve’s ninth interest rate cut of the year and a push by President Bush for an economic stimulus package worth $60 billion.

“The market is attempting to stabilize,” said Alan Ackerman, executive vice president of Fahnestock &Co.

Trading volume was lighter than normal, which could be attributed partly to traders’ caution, as well as the Columbus Day federal holiday. There also were no major third-quarter earnings reports due to be released.

Some investors evidently worried that the United States will suffer more terrorist attacks for having launched a military strike against Afghanistan.

“This is a combination of things. There is some concern on the part of some investors about the retaliation. There is also some ordinary profit- taking from the extraordinary strong run,” said Bill Barker, investment strategy consultant for Dain Rauscher in Dallas.

Blue chip losers included the nation’s three big automakers, trading lower on a report in the Financial Times that Ford, General Motors and DaimlerChrysler are slashing production by a further 196,000 vehicles before the end of the year. Ford fell 38 cents to $17.29, General Motors lost 71 cents to trade at $41.65, and DaimlerChrysler slipped 25 cents to $33.87.

The technology sector fared a little better. Dell Computer rose 56 cents to $23.12 and Cisco Sytems inched up 11 cents to $15.05.

“My feeling is, if there are no significant casualties on the U.S. side and the strikes continue with no difficulties, the market will be quite and stable with more of a wait-and-see attitude,” Barker said.

Declining issues outnumbered advancers more than 3 to 2 on the New York Stock Exchange. Volume was 966.65 million shares, well below the 1.31 billion shares traded Friday.

Copyright ©2001 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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