graphic
graphic  
graphic
Markets & Stocks
graphic
Stocks in transition
Investors digest Fed's weak economic view, mixed techs, airline disturbance on Sept. 11 anniversary.
September 11, 2002: 5:47 PM EDT
By Alexandra Twin, CNN/Money Staff Writer

NEW YORK (CNN/Money) - U.S. stocks closed mixed Wednesday as investors struggled to digest a weak report on the economy and the one-year anniversary of the worst terrorist attack in the nation's history.

The Dow Jones industrial average lost 21.44, or 0.25 percent, to close at 8,581.17; it was up more than 100 points earlier in the session before pulling back. The Nasdaq composite lost 4.64, or 0.35 percent to close at 1,315.45. The Standard & Poor's 500 index lost 0.13, or 0.01 percent, to close at 909.45.

Stocks that rose barely outnumbered those that fell in light trading on the New York Stock Exchange. Just 839 million shares changed hands, well below the typical 1 billion or more. On the Nasdaq, decliners and advancers were nearly evenly split as 1.06 billion shares changed hands.

The Nasdaq opened for trading at 11 a.m. ET, but the New York Stock Exchange delayed its open until noon, approximately 30 minutes after the conclusion of the memorial services at the site where the World Trade Center stood.

"We all wanted to move beyond this day and get past the anniversary," Stephen Porpora, managing floor broker at William O'Neil & Co., told CNNfn, adding that the fact that "we just got through it" was encouraging. "Certainly, the fact that the market ended down a little bit is not an act against patriotism. Everyone has been saying that the week starts Thursday when Bush and Greenspan speak."

On Thursday, President Bush launches his appeal to the United Nations for global action against Iraqi president Saddam Hussein and Fed Chairman Alan Greenspan addresses the House Budget Committee.

In addition, after the close of trade, graphics software maker Adobe Systems (ADBE: down $0.11 to $19.18, Research, Estimates) is due to report its fiscal third-quarter results. The company is expected to have earned 19 cents per share, down from the 28 cents per share earned one year earlier.

Employees work on the floor of the New York Stock Exchange Wednesday morning, as former New York Mayor Rudolph Giuliani is seen on television reading the names at a memorial service of those who died in the World Trade Center attack.  
Employees work on the floor of the New York Stock Exchange Wednesday morning, as former New York Mayor Rudolph Giuliani is seen on television reading the names at a memorial service of those who died in the World Trade Center attack.

Stocks initially barreled out of the gate Wednesday, showing broad-based gains in a variety of sectors, but lost some steam after the release of the Federal Reserve's "Beige Book" survey on the state of the economy, and as news flashed late in the session of a "security incident" aboard a plane in Houston. The weak volume was also a factor, as it tends to magnify the impact of any program or other large-volume trades.

The Beige Book showed slow and uneven growth across the country, and that manufacturers, hit hard by the recession, continued to experience weak demand. Other findings included little job growth. The report is taken into consideration by Fed policy makers when they meet Sept. 24 to decide upon interest rates.

Stocks struggled to regain momentum following the release of the survey, but fell back again, possibly in response to reports of a security incident in Houston involving an American Airlines flight. According to Reuters, FBI agents said that the incident may have been an attempted hijacking. News reports said passengers reported seeing two men in the cabin with what appeared to be a weapon. However, the flight ended with a successful landing and the men were taken into custody.

Techs in mixed trade

Techs started off the session broadly higher, but closed mixed, with declines in companies such as Microsoft (MSFT: down $1.21 to $48.58, Research, Estimates), Sun Microsystems (SUNW: down $0.14 to $3.37, Research, Estimates) and IBM (IBM: down $1.40 to $74.20, Research, Estimates) countering gains in telecom and semiconductors.

Sun and IBM may have declined in sympathy with Hitachi (HIT: down $1.91 to $51.95, Research, Estimates), which fell after the company lowered its earnings forecast for its fiscal first half and on talk of pricing pressure at Hitachi Data Systems.

But on an up note, chips and telecoms performed well.

"After all of the 'world is coming to an end' response ahead of Intel's forecast last Thursday, the stock has bounced back. Intel (INTC: up $0.15 to $16.62, Research, Estimates) has rallied 14 percent in a week," said Donald Selkin, director of research at Joseph Stevens. Also, you've got some analysts upping estimates on Nokia."

Merrill Lynch raised its third-quarter revenue and earnings estimates and full-year estimates for handset maker Nokia (NOK: up $0.74 to $14.61, Research, Estimates), a day after the company lowered its sales targets for the current quarter but reaffirmed its profit forecast.

Shares of the stock rose, along with others in the telecom and telecom-equipment sector, including Dow component SBC Communications (SBC: up $0.97 to $25.85, Research, Estimates), Qwest Communications (Q: up $0.14 to $3.18, Research, Estimates) and Ciena (CIEN: up $0.32 to $4.30, Research, Estimates).

Programmable chip maker Xilinx (XLNX: up $0.64 to $19.80, Research, Estimates) reaffirmed its second-quarter revenue guidance after the close of trading Tuesday. The company expects revenue between $270 million and $280 million.

On the Dow industrials, shares of aerospace and defense company Honeywell International (HON: down $1.68 to $28.52, Research, Estimates) lost about 5.5 percent, due to a news report that the company is facing a trial in a lawsuit that claims auto mechanics contracted lung disease by breathing asbestos dust while working on brakes made by a former Honeywell unit.

"Reports of additional litigation claims are definitely hurting the stock. Most of the other companies mentioned in the suit have settled out of court, when Honeywell has not," said Robert Norfleet, an aerospace and defense analyst at Davenport & Co.

"But this is nothing new, as the suit has been going on for some time," he said. "And in previous suits, the company has been able to settle out of court, and in a broader sense, the company's fundamentals are solid. So in my opinion, the selling today is an overreaction as the issue will be resolved favorably. But for now, this does present uncertainty, which makes people nervous, and that's what's taking the stock lower."

Treasury prices fell sharply, pushing the yield on the 10-year note up to 4.05 percent. Light oil futures gained 4 cents to $29.77 a barrel, while gold declined. The dollar was a little stronger versus the euro and yen.  Top of page




  More on MARKETS
Why it's time for investors to go on defense
Premarket: 7 things to know before the bell
Barnes & Noble stock soars 20% as it explores a sale
  TODAY'S TOP STORIES
7 things to know before the bell
SoftBank and Toyota want driverless cars to change the world
Aston Martin falls 5% in its London IPO




graphic graphic

Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.

Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.