The ugliness was widespread on Wall Street early this afternoon as traders weren't showing any enthusiasm for buying stock ahead of the long weekend.
The losses in the market came despite favorable news on the inflation front for the second day in a row and some modest strength in the bond market. However, a lingering hangover from
testimony yesterday, and a reluctance to go
long into the weekend had traders and investors paring back positions.
Dow Jones Industrial Average
was off 142.72, or 1.36%, to 10,371.85.
was the biggest drag on the Dow and was lately off 4.6%.
Ricky Harrington, chief technical analyst at
in Charlotte, N.C., pointed out that the Dow has support from 10,200 down to 10,000. Of what he took out of Greenspan's appearance before the
House Banking Committee
yesterday, Harrington said that Greenspan "all but said" he's going to raise rates until the economy cools off or until the stock market does.
was down 17.85, or 1.29%, to 1370.40.
Nasdaq Composite Index
was last measured down 13.43, or 0.3%, to 4535.49. However, time has stood still for the Comp lately. The Comp isn't updating due to a computer problem. So take that quote with the requisite grain of salt.
Internet and networkers were among the notable losers weighing on the Comp. Not helping was modest weakness in index heavyweights
was down 58 to 4067.
was down 4.9, or 0.9%, to 553.52. The
American Stock Exchange Biotechnology Index
was down 1.6%.
TheStreet.com Internet Sector
index was down 15.15, or 1.32%, to 1129.34, with
among the downside leaders in the DOT.
Today is also the double-expiration of some stock and futures options, which some said is playing into the market's movements today.
Peter Cardillo, chief strategist at
, said the decline in the Russell 2000 and the Nasdaq Comp was due to profit taking ahead of the long weekend. He also pointed out that the financials and the so-called "old economy" stocks continued to be under pressure today.
Cardillo said he's seeing a lot of the microcap stocks continuing to do well, an area of the market that has been forgotten for some time. He said the buying in that area of the market shows that people aren't afraid of the stock market. He did note, however, that within the small-cap world, the buying interest has been selective and honed in on technology and biotech stocks.
Breadth was decidedly negative. (see below)
Yesterday, for the first time ever, more than 2 billion shares changed hands on the
Nasdaq Stock Market
. Daily volume on the Nasdaq this year has averaged 1.679 billion shares, according to Nasdaq.
"This market is getting more and more irrational," said Harrington. He pointed out that over the last 23 sessions, the Dow has been down more than 10%, while the Nasdaq, over the last 14 sessions, has been up 21%.
With the weakness in basic industry stocks, along with softness in commodity-related issues like paper and chemical stocks, the market is telling him that the economy is going to slow down, probably dramatically before the end of the year.
Conversely, while those stocks languish, Harrington pointed to the recent strength in tech and biotech stocks, which he said was all about "money flow." With cash flowing into tech and biotech funds, money managers have to put that cash to work. Harrington said that those stocks are going up for liquidity reasons than fundamental ones. That liquidity situation, he added is "a dangerous situation" for investors because it can change quickly and dramatically.
In the Treasury market, the 30-year Treasury bond was up 29/32 to 101 8/32, yielding 6.158%. The 10-year Treasury note was up 15/32 to 100 1/32 to yield 6.502%. (For more on Treasuries, please look at
Bond Focus column.)
On the economic front, the
said the overall
Consumer Price Index
for January rose a lower-than-expected 0.2%, while excluding food and energy prices, the so-called core CPI, rose 0.2%. Economists polled by
expected overall CPI to rise 0.3%, while the core was projected to rise 0.2%.
Overall, the mostly-as-expected results in the CPI neither increase nor lessen pressure on the Fed to raise interest rates to cool the economy.
Among other indices, the
Dow Jones Utility Average
was down 1.6%; the
Dow Jones Transportation Average
was down 1.2%; and the
American Stock Exchange Composite Index
was down 0.3%.
New York Stock Exchange:
821 advancers, 2,033 decliners, 561 million shares. 27 new 52-week highs, 175 new lows.
Nasdaq Stock Market:
1,641 advancers, 2,310 decliners, 1.076 billion shares. 302 new highs, 81 new lows.
For a look at stocks in the midsession news, see Midday Movers, now published separately.