Stocks take steep drop, but recover

By AMY BALDWIN

Associated Press

NEW YORK – Stocks fell this afternoon after it appeared there might be no quick resolution to the presidential election, but mostly recovered by the end of the day.

Unsure how to invest given the political uncertainty, investors quickly unloaded shares.

The Dow Jones industrial average was down 288 at one point as Democratic Party officials said they would demand a follow-up recount by hand in a few Florida counties and that they would support unspecified “legal actions.”

The market recouped most of its losses, but the Dow still closed lower, off 72.81, or less than 1 percent, at 10,834.25, according to preliminary calculations.

The Nasdaq composite index – which fell 184 points Wednesday – slid an additional 144 points before closing with a loss of 31.35, or less than 1 percent, at 3,200.35.

The broader Standard &Poor’s 500 index ended the session down 9.14, or 0.65 percent, at 1,400.14.

One analyst credited the markets’ recovery to bargain hunting and to a statement earlier in the day from Attorney General Janet Reno, who said the federal government won’t get involved in the recount.

“The market got oversold and people jumped back in to pick up some bargains,” said Eugene Mintz, financial markets analyst at Brown Brothers Harriman &Co. “Part of it was probably the fact that the federal government said it can’t get involved. There is a little bit of relief in that.”

Stocks had moved lower during the previous two sessions while the market awaited the outcome of the election. Investors were focused on the poor outlook for high-tech company earnings.

The decline turned into a plunge this afternoon, when Al Gore campaign chairman William Daley and former Secretary of State Warren Christopher complained to reporters in Florida about voting irregularities. The outcome of the presidential election hinged on Florida’s 25 electoral votes.

Investors interpreted the Democrats’ statements as opening the possibility of a further delay in determining who the country’s next president will be.