|
Stocks fall dow below 9000 { June 10 2003 } Original Source Link: (May no longer be active)
http://www.sunspot.net/business/investing/bal-bz.wallst10jun10,0,4787891.story?coll=bal-investing-headlineshttp://www.sunspot.net/business/investing/bal-bz.wallst10jun10,0,4787891.story?coll=bal-investing-headlines
Stocks fall, take Dow below 9,000
Blue-chip index drops 82; Nasdaq is off 23, while S&P 500 declines 11
From Wire Reports
June 10, 2003
NEW YORK - Stocks took a break from their big rally yesterday, dropping sharply as investors, wary that prices have climbed too high, too quickly, cashed in some of their profits.
"I am glad to see a pause in here. The last thing we need is for the market to get ahead of itself," said Joseph Keating, chief investment officer at AmSouth Asset Management in Birmingham, Ala.
Freddie Mac's dismissal of its president and chief operating officer and an earnings warning from Motorola Inc. contributed to the decline. Still, analysts said investors remain confident that the market and the economy have turned a corner.
The Dow Jones industrial average closed down 82.79, or 0.9 percent, at 8,980.00, coming down from a stunning week in which it closed above 9,000 for the first time in nearly 10 months and ended with a 2.4 percent gain.
The broader market also retreated. Having advanced 2 percent last week, the Nasdaq composite index fell 23.45, or 1.4 percent, to 1,603.97. The Nasdaq is trading at levels not seen since May 2002.
The Standard & Poor's 500 index declined 11.83, or 1.2 percent, to 975.93, after its own stellar week in which it traded above 1,000 for the first time in almost a year and gained 2.5 percent. The S&P is at levels not seen since July.
Analysts said the market was due for some natural pullback after weeks of heavy buying. The Nasdaq and S&P finished higher in seven of the past eight weeks, while the Dow was up in six of the past eight weeks.
"It came too far, too fast," said Hugh Johnson, chief investment officer at First Albany Corp.
By the end of Friday's trading, the Dow had risen 20.4 percent, the Nasdaq had gained 28 percent and the S&P had climbed 23.4 percent since March 11, when the rally began.
Elsewhere on the broad market, the Russell 2000 index of smaller stocks fell 9.15, or 2 percent, to 444.79 and the Wilshire 5000 total market index, the broadest measure of U.S. shares, dropped 122.64, or 1.3 percent, to 9,329.90. Based on changes in the Wilshire, the market value of U.S. stocks decreased by $147 billion.
The Sun-Bloomberg index of the top stocks in Maryland fell 1.98 to 211.88. Medifast Inc. tumbled $1.86 to $12.39, and Legg Mason Inc. slid $1.52 to $63.65.
Declining issues outnumbered advancers more than 2 to 1 on the New York Stock Exchange. Volume was 1.33 billion shares, down from 1.89 billion Friday.
Freddie Mac was the biggest drag on the S&P 500, dropping $9.61 to $50.26. The No. 2 buyer of U.S. mortgages fired its president, and said its chairman-chief executive retired and its chief financial officer resigned.
Freddie Mac and its largest rival, Fannie Mae, own or guarantee 42 percent of the U.S. mortgage market. Fannie Mae's shares dropped $3.63 to $71.31. Countrywide Financial fell $1.49 to $74.58.
Motorola Inc. slipped 21 cents to $8.68 after it reduced sales and profit forecasts for the year, blaming excess inventory and the outbreak of severe acute respiratory syndrome in Asia.
Nortel Networks Corp., North America's largest telephone equipment maker, declined 16 cents to $3.14. Its stock has almost doubled this year.
"Valuations are just too high to ignore," said Steven Levy, an analyst with Lehman Brothers Inc. who cut ratings on Nortel, Sonus Networks Inc., ADC Telecommunications Inc., and Tellabs Inc.
Sonus, whose shares have more than quadrupled in 2003, lost 54 cents yesterday to $4.38. ADC, up 27 percent in that period, declined 18 cents to $2.65, and Tellabs retreated 41 cents to $7.68.
R.J. Reynolds Tobacco Holdings Inc. declined $1.22 to $34.97. The second-largest U.S. cigarette maker said Chief Financial Officer Richard H. Bogan resigned after less than a year.
General Dynamics Corp., the No. 5 U.S. military contractor, fell $1.42 to $67.19. It agreed to acquire Veridian Corp. for $1.23 billion to increase sales of intelligence-gathering equipment as the U.S. government expands its fight against terrorism. Veridian, whose main business is making sensors that collect data using aircraft and satellites, and software that analyzes the information for federal agencies and war planners, surged $7.13, or 26 percent, to $34.48.
Northrop Grumman Corp., the third-largest U.S. defense contractor, dropped $1.90 to $83.50. The company agreed to pay $111 million to settle claims that TRW Inc., acquired by Northrop in December, overcharged the federal government on some space projects.
Adobe Systems Inc., the world's largest maker of software for publishing and graphic design, slipped $1.89 to $35.40 on a downgrade from Smith Barney.
Check Point Software Technologies Ltd. fell 95 cents to $19.23. The maker of electronic-surveillance equipment is overvalued given that it will continue to lose market share to Cisco Systems Inc. and NetScreen Technologies Inc., a Credit Suisse First Boston analyst said in downgrading the stock. Cisco shed 13 cents to $17.23. NetScreen lost 83 cents to $23.42.
QLogic Corp., a maker of circuit boards, switches and chips to manage data flow in computers, dropped $2.10 to $48.93. The stock is expensive and profit margins are likely to slip, Goldman, Sachs & Co. said.
ConocoPhillips fell 67 cents to $54.03 after Lehman Brothers downgraded the third-largest oil company. ChevronTexaco Corp. fell 65 cents to $73.61. Exxon Mobil Corp. added 12 cents to $37.46.
Oxigene Inc. surged $5.32, or 63 percent, to $13.80. The biotechnology company, which is developing the tumor-starving medicine Combretastatin, said it will test the drug against ovarian cancer. Oxigene's stock, which surged more than 80 percent Wednesday, has more than tripled in value this month.
Overseas, Japan's Nikkei stock average rose 0.4 percent; Britain's FTSE 100 declined 0.5 percent; France's CAC-40 fell 1.2 percent; and Germany's DAX index lost 1.1 percent.
The Associated Press and Bloomberg News contributed to this article.
Copyright © 2003, The Baltimore Sun
|
|
