Share this article

print logo

NYSE HALTS TRADING TWICE TO STEM THE SLIDE

A selling frenzy triggered by fallout from the Asian financial crisis sent the Dow Jones industrial average plunging 554.02 points to 7,161.39, its biggest one-day point decline ever and causing the NYSE to halt trading. The Dow's 7.18 percent dive was the 12th largest percentage-point decrease in the Dow's history.

"It's a bloodbath," said Arnold Kaufman, a market analyst at Standard & Poor's. "It scares you because when you get a decline this fast, there's a risk it will keep snowballing."

Trading was suspended for the first time since trading halts went into effect at the New York Stock Exchange nine years ago.

Yet, even the first halt to the downside limit -- as the Dow fell by more than 350 points at 2:38 p.m. -- was not enough to stem the slide. Soon after that 30-minute halt was lifted, stocks resumed their downward path, and the NYSE again suspended trading for the entire day when the Dow lost more than 550 points at 3:30 p.m. According to exchange rules, trading would have resumed after a one-hour suspension.

In line with NYSE rules, the American Stock Exchange and the NASDAQ also halted trading.

"Things got a little panicky at the end," said one trader. "It dropped 200 points in 25 minutes -- that shook people up a bit."

On the Big Board more than 685.52 million shares traded and declining issues overwhelmed advancers, 2,987 to 182.

As for other major indexes that posted record point declines, the S&P 500 fell 64.67, or 6.8 percent, to 876.97, the NASDAQ composite dropped 115.78, or 7.0 percent, to 1535.14, the NYSE composite ended down 32.57, or 6.5 percent, at 463.21, and the Russell 2000 closed 27.49 lower, or 6.1 percent, at 420.16.

Stocks were poised to open lower Monday after analysts said a failed recovery in the Hong Kong stock market served as a disconcerting sign to investors in other foreign markets. The Hang Seng index fell 646.14, or 5.8 percent, to 10,498.20.

Shares plunged in early trading this morning on the Hong Kong Stock Exchange, dragged down by Wall Street's slump overnight.

The Hang Seng index lost 1,182.59 points, or 11.26 percent, in the opening 15 minutes of trading, sinking to 9,315.61.

In other foreign markets, the United Kingdom's FTSE 100 share index dropped 2.6 percent, Germany's DAX index ended down 4.2 percent, and Japan's Nikkei average shed 1.8 percent.

The Dow is now down by more than 13.2 percent from its closing high of 8,259.31 set Aug. 6 and is more than 11.1 percent lower from last Tuesday's finish. However, some analysts wonder if the market will continue to drop or if buyers will come back into the fray once trading resumes this morning.

In the Dow industrials, not a single stock closed on a positive note, and many of its cyclical components were the weakest performers. AlliedSignal plummeted 4 7/8 , or 12.6 percent, to 33 5/8 ; Boeing took a nose dive, falling 5 1/2 , or 11.3 percent, to 43, and International Paper plunged 5- 9/1 6, or 10.4 percent, to 47 5/8 .

Amid the broad market decline, health-care, gold-producers, disk-drive makers, semiconductor manufacturers and brokerage stocks were the weakest performers.

HBO & Co. closed down 6 3/8 at 39 7/8 , Newmont Mining edged down 7 1/8 to 34 5/8 , Seagate Technology fell 3- 3/1 6 to 27 3/1 6, Intel sank 5 1/4 to 74 3/4 , and Merrill Lynch dropped 8 3/8 to 64.

One of the few stocks that closed on higher ground was Apple Computer, which rose 3/1 6 to 16 3/4 .

Also bucking the downtrend, CFX Corp. stock rose 1-1 5/1 6 to 24 5/8 following news that Peoples Heritage Financial Group -- a multibank and financial services holding company based in Portland, Maine -- reached an agreement to acquire the Keene, N.H.-based company for $703 million, creating New England's fourth-largest banking company. Shares of Peoples Heritage dipped 4 to 39 1/8 .

Oxford Health Plans lost more than half its market value after the health-care firm warned investors its third-quarter earnings would fall short of Wall Street's expectations. Oxford's stock plummeted 42 7/8 , or 62.3 percent, to 25 7/8 .

Micro Warehouse tumbled 8 3/4 to 11-1 5/1 6 after the company announced the resignation of its president and chief executive officer, Linwood Lacy, over a disagreement over "certain strategic matters." The company also reported third-quarter earnings per share that came in right in line with analysts' expectations.

Phoenix International dropped 10 to 14 on a warning that the software maker will have earnings per share below the 14 cents it posted a year ago. Analysts were looking for earnings per share of 21 cents.

Bond prices surged Monday. The benchmark 30-year Treasury bond rose $20 for each $1,000 in face value. Its yield, which moves in the opposite direction from price, fell to 6.12 percent from 6.27 percent late Friday. The yield was the lowest since it finished at 6.09 percent on Feb. 14, 1996.

There are no comments - be the first to comment