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Thursday, Aug. 6, 1998
Dow's up and down day finishes on an up
Market gets boost from analysts' positive comments
By BRUCE MEYERSON
Associated PressNEW YORK -- Stocks staged a late rebound Wednesday, but the market remained extremely volatile as some reassuring words from top strategists and major companies bolstered confidence only so much after Tuesday's 300-point plunge.
The Dow Jones industrial average rallied back in the final half hour, erasing a 125-point deficit and finishing 59.47 higher at 8,546.78.
The stock barometer of 30 major companies reversed course as its steep slide from last month's record high reached 10 percent -- the minimum loss for what's often called a ``market correction'' and a frequent trigger point for bargain hunters.
Trading continued at Tuesday's blistering pace, with volume exceeding 1 billion shares for only the third time ever.
The Dow now sits 791 points below its all-time best close of 9,337.97, set less than three weeks ago on July 17. This year's once-robust gain of 18.1 percent now stands at 8.1 percent.
Despite the day's strong finish, Wednesday's activity was hardly comforting. The Dow fell 75 points during the first half hour of trading, but turned higher as investors began nibbling at popular stocks that have been hit hard in recent weeks. The buying peaked at midday, however, and an 87-point Dow gain quickly evaporated.
``Today has been about shock. Investors right now are just trying to regroup, reevaluate, and realize whether what caused yesterday was just psychology or a change in fundamentals,'' John Lynch, director of investment strategy at Interstate/Johnson Lane in Charlotte, N.C., said Wednesday.
``The (economic) foundation is still strong, but there's still an uncertainty, a discomfort among investors. Things have been good for so long and people are looking over their shoulders,'' said Lynch. ``Once the market starts to move, it pulls back each time, and I think it will continue for a time.''
The day began with mixed signals. Predictably, the ripples from Tuesday's selloff were felt in markets around the globe, including several that are still reeling from Asia's nearly year-old economic crisis.
But on a more encouraging note, there were solid profit reports by America Online, Aetna and computer networking giant Cisco Systems. Encouraging comments from prominent market strategists Abby Joseph Cohen at Goldman Sachs and Edward Kerschner at PaineWebber also helped.
``We would be aggressive buyers and we believe that if investors buy today, six-12 months from now they will be glad they did,'' Kerschner said in a statement that contrasted sharply with Tuesday's repeated warnings on CNBC by Ralph Acampora, a Prudential Securities analyst previously noted for his brazen optimism.
``You have the industry icons saying fundamentals are strong,'' and ``household names reporting strong quarters can be reassuring for the investing public,'' said Lynch. ``But there's still a negative bias.''
In other trading Wednesday, the Standard & Poor's 500 index rose 9.31 to 1,081.43, and the technology-heavy Nasdaq composite index rose 2.65 to 1,788.20.
Declining issues outnumbered advancers by nearly a 3-to-2 margin on the New York Stock Exchange. Volume of NYSE-listed shares totaled 1.017 billion shares, exceeding Tuesday's tally of 1.007 billion.
The NYSE composite index rose 2.65 to 544.01, but the Russell 2000 index of smaller companies fell 2.94 to 398.69 and the small-company dominated American Stock Exchange composite index fell 6.69 to 672.07.
Overseas, share prices plunged 4.2 percent in Indonesia and 3.2 percent in South Korea to lead the decline in Asia.
Hong Kong's Hang Seng index fell 1.5 percent after sliding 4.8 percent on Monday, but Tokyo's Nikkei average rebounded from an early slide, finishing just 0.2 percent lower.
In Europe, Germany's DAX index tumbled 3.2 percent, while London's FT-SE 100 fell 1.8 percent.Post your comments about local news eventsFront Page || Main Index || News || Business || Texas || South Texas Outdoors || Birdwatching || Sports || Entertainment || Selena || Education || South Texas Attractions || World Wide Web