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Dow under siege
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December 2, 1998: 1:48 p.m. ET
Blue chips collapse under pressure from Boeing, Sears and GM
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NEW YORK (CNNfn) - A broad slide hitting U.S. stocks reached new depths in afternoon trading Wednesday as bearish forecasts from several Dow stocks, led by Boeing, prompted investors to exit the market en masse.
Shortly before 1:30 p.m. ET the Dow Jones industrial average was 144.95 points, or 1.6 percent, lower at 8,988.59. Declines led advances 1,816 to 1,109 as trading volume on the New York Stock Exchange reached 447 million shares.
The Nasdaq Composite dropped 16.42 to 1,987.33 and the S&P 500 index fell 12.47, or 1.1 percent, to 1,162.81. (Click here for a look at today's CNNfn market movers)
Boeing's suffering, caused by a gloomy forecast, triggered a sharp tumble in its stock and dragged the broader market down as investors began speculating that corporate earnings overall are likely to decline as the world continues to grapple with a persistent economic slowdown.
The bond market was higher, attracting buyers among investors taking their money out of stocks. The benchmark 30-year Treasury bond rose 1/2 of a point in price, for a yield of 5.01 percent.
The dollar fell against major currencies, hurt by the stock market's declines and speculation that European interest rates are unlikely to decline any time soon.
Boeing batters the Dow
A jumbo plummet in the stock of jumbo jet maker Boeing (BA), after the company late Tuesday painted a bleak picture for the near-term future and said it would cut production and slash 20 percent of its workforce over two years, was almost single-handedly responsible for the early declines in the Dow industrials. Boeing's shares tumbled 6-5/8, or more than 16 percent, to 33-3/4.
General Motors (GM), another heavyweight Dow member, also took a hit, losing 1-7/8 to 69-7/8 after the Boeing of carmakers warned investors to expect a disappointing November sales report.
Sears Roebuck (S), helped GM and Boeing drag the Dow down, sinking 1-15/16 to 42-5/8 after the department store giant reported November same-store sales -- those at stores open at least a year -- fell 3.6 percent. Sears also said it expects full-year earnings to rise at a low single-digit percentage rate.
Among the day's other big losers, shares of IDT Communications (IDTC) lost 3-7/8, or more than 19 percent, to 16-1/2. Late Tuesday the company reported earnings in line with expectations and said it is exploring strategic options that could include a spin-off of its Internet communications services unit.
Blue-chip technology issues, largely responsible for Tuesday's bullish market turnaround, sank into the red a day later. Dow component IBM (IBM) fell 3-5/16 to 166-9/16. On the Nasdaq, Intel (INTC) shed 1-1/16 to 113-15/16, and Microsoft (MSFT) was down 1-7/8 to 127-5/8. Sun Microsystems (SUNW) tumbled 5-3/16 to 74-3/4 and Cisco Systems (CSCO) shed 1-15/16 to 77-13/16.
A continuous slump in world oil prices, however, helped airline stocks buck the broad market trend and gain altitude. AMR (AMR), the parent of American Airlines, rose 1-5/16 to 69-3/16, Delta Air Lines (DAL) climbed 13/16 to 56-5/16 and UAL (UAL), the parent of United Airlines, advanced 1-1/2 to 65-3/8. The Dow transports index was up 22.84 to 3,070.68. 
-- by staff writer Malina Poshtova Zang
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