Stocks close lower on concerns for election uncertainty


Associated Press

NEW YORK — Stocks fell sharply today as Wall Street again wrangled with concerns about corporate earnings and the slowing economy. The persisting deadlock in the presidential election only added to the market’s own stalemate.

Investors trade on their increasing fears that a slowing economy and the possibility of higher interest rates would further crimp company profits, particularly those of high-tech firms. The Florida Supreme Court’s ruling late Tuesday that election ballots being recounted by hand should be included in the state’s overall tally also contributed to selling.

The Nasdaq composite index tumbled 116.11 to 2,755.34. The last time the Nasdaq closed lower was Oct. 19, 1999 when it finished at 2,688.18.

The Dow Jones industrial average fell 95.18 to close at 10,399.32, and the broader Standard &amp Poor’s 500 index fell 24.99 to 1,322.36.

After more than two months of negative earnings news and a series of selloffs, Wall Street seemed ready to break for Thanksgiving, and volume was light as many traders left early for the holiday. But they still sold off the already depressed technology sector.

Intuit dropped $4.31 to close at $43.88 after ABN Amro analysts downgraded their rating for the maker of tax software. Intuit predicted it would have lower than expected sales in its second quarter. It also said it lost less money in its first quarter than analysts forecast.

Network equipment maker Nortel fell 52 cents to $37.73 despite saying Tuesday its sales will grow about 40 percent in the fourth quarter.

"There is increasing evidence building that we are seeing a slowdown in demand for PCs, cell phones and other electronic devices," said Alan Skrainka, chief market strategist for Edward Jones of St. Louis. "Stocks that were priced for perfection are coming down sharply because we have less than a perfect environment."

Investors have been dumping pricey technology issues ever since companies began warning that earnings and sales would slump. With the lack of resolution in the election, investors are sticking to that strategy.

The market’s few recent rallies have been brief and brought on spurts of bargain hunting.

"In the short run, emotions drive the stock market and right now fear has the upper hand," Skrainka said. "Politics are a factor, but they aren’t the key reason stocks are dropping … The main concern is the slowdown of the economy and the slowdown on corporate earnings and problems in the technology sector."

But some analysts believe the election was a significant factor in Wednesday’s trading.

"Today’s market is absolutely politically related," said Barry Hyman, chief investment strategist for Weatherly Securities.

He reasoned that earnings outlooks were no worse Wednesday than they have been in recent sessions. And, he noted that tobacco companies have fallen when Vice President Al Gore seemed to gain ground in the dispute, and that drug stocks benefited from news that seemed to favor Texas Gov. George W. Bush.

Looking at those sectors Wednesday, it appeared to be a draw. Drug maker Merck lost $1.31, finishing Wednesday at $90.69. Cigarette maker Philip Morris slipped $2.43 to $35.

Other stocks moved on non-political events.

Coca-Cola, which announced late Tuesday night it won’t buy Quaker Oats, rose $4.38 to $59.63. Quaker stumbled $7.44 to $87.

Airline stocks traded lower while travelers set off to celebrate Thanksgiving. Northwest was off 19 cents at $24.19, and United Airlines fell $1.38 to $36.13. Both airlines face possible flight delays because of disgruntled mechanics.

Wall Street had new evidence Wednesday that the economy is slowing. The Labor Department said the number of Americans who filed new claims for unemployment benefits rose 7,000 to a seasonally adjusted 336,000 for the week ending Nov. 18.

The Russell 2000 index, which tracks smaller companies, fell 8.89 to 457.90.

Declining issues outnumbered advancers nearly 2 to 1 on the New York Stock Exchange where volume was 960.35 million shares, well below Tuesday’s 1.11 billion.

Overseas markets also closed lower. Japan’s Nikkei stock average fell 0.7 percent, and Germany’s DAX index dropped 2.5 percent. Britain’s FT-SE 100 lost 2.5 percent, and France’s CAC-40 fell 2.2 percent.

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

Talk to us

More in Local News

Arif Ghouseat flips through his work binder in his office conference room Paine Field on Monday, Dec. 10, 2018 in Everett, Wa. (Olivia Vanni / The Herald)
Paine Field Airport director departing for Sea-Tac job

Arif Ghouse, who oversaw the launch of commercial air travel at Paine Field, is leaving after eight years.

NO CAPTION. Logo to accompany news of education.
Public school enrollment still down, even as rural districts grow

Smaller districts in Snohomish County seem to be recovering more quickly — and gaining students — than their urban counterparts.

Angelica Montanari and daughter Makena, 1, outside of the Community Health Center of Snohomish County Everett-Central Clinic on Thursday, Feb. 2, 2023. (Olivia Vanni / The Herald)
Amid patient woes, CHC of Snohomish County staffers push for a union

Doctors and nurse practitioners are worried about providers being shut out from clinical decisions, which hurts patient care.

Students make their way after school at Edmonds-Woodway High School on March 12, 2020. (Kevin Clark / The Herald)
After Edmonds schools internet outage, staff ‘teaching like it’s the 1900s’

“Suspicious activities” on the district’s network delayed classes and caused schedule havoc. “Kids are using pencil and paper again.”

NO CAPTION NECESSARY: Logo for the Cornfield Report by Jerry Cornfield. 20200112
Retooling drug laws, protecting octopus and honoring a cactus

It’s already Day 26. Here’s what’s happening in the 2023 session of the Washington Legislature

April Berg, left, and John Lovick
Snohomish County legislators talk race, policy in Seattle

Rep. April Berg and Sen. John Lovick chatted about Tyre Nichols and education at an event kicking off Black History Month.

A suspect removes a rifle bag from a broken rear window of a Seattle police car on May 30 in downtown Seattle. An Everett man, Jacob D. Little, 24, has been charged with the theft of the high-powered rifle stolen from the car. This image is from the criminal complaint filed in U.S. District Court. 20200904
Everett man sentenced for stealing police gun in Seattle protest

Jacob Little, 26, now faces second-degree murder charges for allegedly killing a man in Renton in August 2020.

Switzerland delegate Markus Herrmann listens while 12th grade students speak with him during a special event set up for their AP Comparative Government class at Glacier Peak High School on Thursday, Feb. 2, 2023 in Snohomish, Washington. (Olivia Vanni / The Herald)
European delegates talk American culture with Glacier Peak students

Representatives from 18 different EU countries made a stop in Snohomish during their US tour.

Community Transit is leasing a 60-foot articulated BYD battery electric bus this year as an early step in the zero emission planning process. (Community Transit)
Community Transit testing 60-foot electric bus

The agency leased the BYD K11M for $132,000 this year as the first step in its zero-emission planning process.

Most Read