What a day! And it's only lunchtime.
Dow Jones Industrial Average has had a tumultuous session, earlier falling 400 points and dropping well below its psychologically important level of 10,000. The index has since rebounded well off its lows of the day, but was still firmly in negative territory.
was the main culprit. Yesterday after the close, it posted earnings that beat estimates, but revenue on the low end of expectations. Big Blue also gave cautious words for the its fourth quarter.
the announcement more in depth in a separate story.
This morning the stock was hit by negative notes from
, which lowered their earnings estimates.
cut its rating on the company to hold from accumulate and
removed IBM from its recommended list. Definitely nothing to write home to mother about.
The company was taking away about 95 points from the Dow, which is a weighted index of 30 blue-chip companies. This is the first time the Dow has traded below the 10,000 mark since March 15.
Also contributing to the Dow's woes was
, with about 45 negative points, after its merger partner
before the market opened reported lower-than-expected earnings. Chase partly blamed losses on the
Nasdaq, which hurt
results at its venture capital arm.
Chase was lately off 2.8% to $36.88. J.P. Morgan actually reported earnings that beat estimates. It was down 2.9% to $133.61. The two stocks, like many shares today, are well off their lows of the morning.
The Nasdaq was lately hovering around the break-even line. It spent most of the morning in the red, but had a brief stint on the upside.
Meanwhile, IBM's trouble was spreading to pretty much all of tech -- except for the semiconductors, which appeared to be celebrating
. Intel last night posted earnings above its revised expectations (that's revised lower, in case you forgot). Though several other analysts came out with downgrades on the company, Intel was lately 3.13% higher to $39.38.
RF Micro Devices
was down 31% after it reported earnings in line with expectations, but warned about earnings for its next quarter. The stock was downgraded by
Credit Suisse First Boston
CIBC World Markets
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Tobacco, paper and retailers were rallying, while just about ever other sector of the market was suffering.
American Stock Exchange Tobacco Index
was 0.3% higher and the
Philadelphia Stock Exchange Forest & Paper Products Index
was up 2.9%.
Drugs -- traditional defensive stocks that have been reporting strong earnings -- should have been getting more investor love. But they weren't. Some analysts were blaming Democratic presidential candidate Al Gore, who was tough on the drug companies again last night during the final of three presidential debates. The
American Stock Exchange Pharmaceutical Index
was down 1.4%.
TheStreet.com E-Finance Index
was down 2.4%, suffering right along with the offline broker/dealer and bank sectors.
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What's bad for stocks today is good for bonds. The bond market is rallying this morning as investors look for safer investments amid weakness in equity markets.
The benchmark 10-year
Treasury note was lately up 8/32 at 100 24/32, pushing its yield down to 5.648%. That puts the government security at its lowest yield of the year.
Bonds have pared back some of their gains from earlier in the morning as the
Dow Jones Industrial Average rebounded off its lows of the day and the
Nasdaq moved into positive territory.
The bond market is clearly much more concerned with the weak performance of the stock market and its implications for lower interest rates than it is with the growing signs of inflationary pressure in the economy.
The bond market was relatively unconcerned by September's
Consumer Price Index
), which was released before the stock market opened this morning and showed a 0.5% rise in the headline inflation number. It also showed a 0.3% increase in the core inflation rate that excludes food and energy prices.
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