NEW YORK (CNNfn) - U.S. stocks tumbled in early trading Friday, hit hard by a global market meltdown and fears the worst is yet to come.
The Dow Jones industrial average opened with a plunge and shortly after 10 a.m. had lost 138.78 points, or 1.6 percent, to 8,472.63. Declining issues trounced advancing stocks 2,081 to 364 as 119 million shares changed hands on the New York Stock Exchange.
The Nasdaq Composite shed 36.79, or just over 2 percent, to 1,795.66 and the S&P 500 index fell 19.27, or 1.8 percent, to 1,072.33.
Comments by Russian Prime Minister Sergei Kiriyenko that his country's financial and economic crisis has barely started and calls for President Yeltsin's resignation, rattled emerging markets around the world and spread as far as Latin America, where fears of currency devaluations sent stock markets plunging.
Russia's woes also stung markets in Europe, while news that another big firm has gone bankrupt hurt stocks in Tokyo and the rest of Asia.
At home, news of Thursday's two U.S. military attacks on suspected terrorist targets in Sudan and Afghanistan added pressure on the market. The attacks raised uncertainty in the market and questions about the timing of President Clinton's decision to strike while an investigation into an affair he had with a former White House intern is at its height.
The global turmoil was good news for the bond market, however, where investors sought protection for their money, driving the yield of the benchmark 30-year Treasury bond down to a record 5.44 percent.
The dollar was caught in a narrow trading range against the Japanese yen and the German mark as international investors sought direction amid the world markets' rout.
Bank stocks feel the pain
Financial services and banking stocks, whose exposure to international currency markets, makes them especially vulnerable, were among the biggest losers in early trading.
Dow component J.P. Morgan (JPM) lost 3-1/4 to 119-9/16 and fellow blue chip American Express (AXP) was down 2-1/2 to 94-5/8. Citicorp (CCI) shed 4-5/16 to 134-3/4 and Chase Manhattan (CMB) fell 2-5/16 to 63-1/16.
Technology heavyweights, which derive a large chunk of their revenues from business in Asia and around the world, also were sent in a free-fall. Microsoft (MSFT) lost 2-3/16 to 110-3/8, Dell (DELL) tanked 2-3/4 to 119-3/8, Intel (INTC) shed 1-13/16 to 84-3/16 and Dow member IBM (IBM) traded 1-1/4 lower at 126-13/16.
Airline shares followed suit, with AMR (AMR), the parent of American Airlines, losing 1-13/16 to 62-1/4, Delta Air Lines (DAL) dropping 4 to 115, and United Airlines parent UAL (UAL) sliding 2-1/8 to 67. The Dow transports index fell 63.72, or 2.09 percent, to 2,983.53.
Finally, shares of software-based imaging systems maker Peerless Systems (PRLS) found no peers among the losers, dropping 14-1/8, or 68-1/2 percent, to 6-1/2 after the company issued a profit warning for the rest of its fiscal 1999 and fiscal 2000.
-- by staff writer Malina Poshtova Zang