Nasdaq Composite Index plummeted more than 100 points for the third session in a row, smashing through supposed technical support levels and raising the already-high worry level on Wall Street.
The steady plunge started with the
Fed's 2:15 p.m. EDT announcement that it continued to see risks of inflation in the economy, but would hold interest rates steady. Although economists expected both outcomes, many market players fervently hoped the Fed would call inflation risks balanced instead.
No such luck. The
Dow Jones Industrial Average managed to cling to positive territory, but technology stocks of all stripes were routed.
In the past, comments from
talking head Abby Joseph Cohen have sparked substantial movement, but today her positive comments on tech stocks and on third- and fourth-quarter corporate profits did little, if anything. And while some say Cohen's repetitiveness on tech stocks has lost weight among traders and investors, Alfred Goldman, chief market strategist at
, said, "In a market that's been in the doghouse for five weeks, investors have become more jaundiced to announcements like these."
He did say his firm agrees with Cohen and that tech stocks are the most dynamic area of the market right now. "I don't see anywhere else with as superior growth opportunities," Goldman said.
Still, investors and traders paid little attention to such thinking and continued to fuel its recent trend of starting strong and finishing weak.
As for the market today, Goldman said, "If the market can develop some cumulative buying, we see averages do well and a good, strong breadth at the close, we can declare victory. It will say the correction is officially dead."
The Dow had been on its way, with the most help coming from
, each adding more than 10 points to the index.
was the biggest drag with about 43 points to the negative.
, off 28.16%, was the
New York Stock Exchange's most active stock after reporting postclose yesterday that it expects to see a third-quarter loss rather than a profit. The copier and printer manufacturer attributed the shortfall to weaker-than-expected sales in North America and Europe and heavy competition in all businesses. The
company reported that it anticipates a loss of 15 cents to 20 cents a share, compared with the analyst forecast of a 12 cent profit. Back in July, the company had warned of weakness in its second half. At that time, Wall Street lowered its consensus earnings estimate.
, meanwhile, was one of the Nasdaq's most actives on news that
will take a 24.6% stake in the company. Corel soared 56.8%.
Transportation and paper stocks rallied, while insurance stocks faltered.
Dow Jones Transportation Average
, up 1.4%, got some lift from airline components, including
. Of course, those stocks also lifted the
American Stock Exchange Airline Index
, which gained 1.6%.
Philadelphia Stock Exchange Forest & Paper Products Index
rose 4.2% thanks to support from nearly every component. Yesterday,
announced that it was in a tentative deal to buy a newsprint mill from a South Korean papermaker. It was up 4.3%.
S&P Insurance Index
was its biggest drag, off 1.5%.
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Treasuries came under pressure after the
Federal Open Market Committee's decision on interest rates. Some investors had expected the Fed to take a friendlier tone, describing the risks to the economy as balanced between higher inflation and slower growth.
Today's economic data were more or less in line with expectations.
New home sales
) fell 3.0% to 893,000, while the
index of leading economic indicators
) fell 0.1%, its fifth consecutive negative or unchanged reading.
The benchmark 10-year
Treasury note fell 7/32 to 99 5/32, lowering its yield to 5.861%.
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