Ramsey
14-08-2002, Wed 9:16 AM
عن دواوجونز نيوزواير
US SUMMARY: Stocks Fall; Treasury Yields Atg 39-Yr Low
DJIA 8482.39 loss 206.50 dn 2.4%
NASDAQ 1269.28 loss 37.56 dn 2.9%
S&P 500 884.21 loss 19.59 dn 2.2%
Dow Future 8481.00 gain 1.00 up 0.1%
NASDAQ Future 909.00 loss 2.00 dn 0.1%
S&P Future 885.40 gain 0.10 up 0.1%
10-Yr US Treasury: 4.05% down 0.19
NEW YORK (Dow Jones)--Wall Street fell victim to a late-day sell-off Tuesday after Federal Reserve policy-makers decided against cutting interest rates but Treasurys staged a powerful rally.
STOCKS: The Fed's inaction rattled investors who were hoping for a more aggressive stance.
Analysts blamed the stock drop on traders who, in the absence of other news, had been focusing for days on the move by the Fed. When the market began to fall shortly after the policy-makers' announcement, computer-generated trading exacerbated the sell-off.
"It's the old story of sell on the news," said Larry Wachtel, market analyst at Prudential Securities.
A report Tuesday by the Commerce Department did little to stir the market. The government said sales at the nation's retailers rose 1.2% in July, but most of the gains were the result of strong auto sales.
Investors were also keeping their eyes on the approaching deadline Wednesday set by the Securities and Exchange Commission for companies to certify their financial reports. Analysts say that if many companies miss the deadline, that could further undermine investor faith and prompt stock sales.
AMR, the parent company of American Airlines, rose 38 cents to $8.74 The airline said Tuesday it will eliminate 7,000 jobs and take other cost-cutting moves.
Leading semiconductor equipment maker Applied Materials Inc. reported fiscal third-quarter earnings that came in flat with a year ago and handily beat Wall Street's expectations. But third-quarter order results of $1.78 billion, which climbed 5% sequentially, were lower than the company's previous target of an increase of 10% to 15%.
BONDS: U.S. Treasurys rallied Tuesday, pushing yields toward historical lows, after Federal Reserve policymakers left rates unchanged but acknowledged that the downside risks to the economy are outweighing its potential upside.
The rally pushed the yield on the benchmark 10-year note to its lowest level in 39 years.
The policy-setting Federal Open Market Committee voted to leave the key federal funds rate unchanged at 1.75%, a 41-year low.
But the panel altered its assessment of the economic outlook, saying risks to the economy no longer are "balanced." The risk of too-slow economic growth is again greater than the risk of higher inflation, the committee said. The language implied the Fed is prepared to cut interest rates, possibly as early as Sept. 24.
"The softening in the growth of aggregate demand that emerged this spring has been prolonged in large measure by weakness in financial markets and heightened uncertainty related to problems in corporate reporting and governance," the Federal Open Market Committee said, after a unanimous vote.
That prospect "makes it very difficult for anyone to be underweight Treasurys at this point," said Sadakichi Robbins, head of global fixed-income trading at Bank Julius Baer in New York.
US SUMMARY: Stocks Fall; Treasury Yields Atg 39-Yr Low
DJIA 8482.39 loss 206.50 dn 2.4%
NASDAQ 1269.28 loss 37.56 dn 2.9%
S&P 500 884.21 loss 19.59 dn 2.2%
Dow Future 8481.00 gain 1.00 up 0.1%
NASDAQ Future 909.00 loss 2.00 dn 0.1%
S&P Future 885.40 gain 0.10 up 0.1%
10-Yr US Treasury: 4.05% down 0.19
NEW YORK (Dow Jones)--Wall Street fell victim to a late-day sell-off Tuesday after Federal Reserve policy-makers decided against cutting interest rates but Treasurys staged a powerful rally.
STOCKS: The Fed's inaction rattled investors who were hoping for a more aggressive stance.
Analysts blamed the stock drop on traders who, in the absence of other news, had been focusing for days on the move by the Fed. When the market began to fall shortly after the policy-makers' announcement, computer-generated trading exacerbated the sell-off.
"It's the old story of sell on the news," said Larry Wachtel, market analyst at Prudential Securities.
A report Tuesday by the Commerce Department did little to stir the market. The government said sales at the nation's retailers rose 1.2% in July, but most of the gains were the result of strong auto sales.
Investors were also keeping their eyes on the approaching deadline Wednesday set by the Securities and Exchange Commission for companies to certify their financial reports. Analysts say that if many companies miss the deadline, that could further undermine investor faith and prompt stock sales.
AMR, the parent company of American Airlines, rose 38 cents to $8.74 The airline said Tuesday it will eliminate 7,000 jobs and take other cost-cutting moves.
Leading semiconductor equipment maker Applied Materials Inc. reported fiscal third-quarter earnings that came in flat with a year ago and handily beat Wall Street's expectations. But third-quarter order results of $1.78 billion, which climbed 5% sequentially, were lower than the company's previous target of an increase of 10% to 15%.
BONDS: U.S. Treasurys rallied Tuesday, pushing yields toward historical lows, after Federal Reserve policymakers left rates unchanged but acknowledged that the downside risks to the economy are outweighing its potential upside.
The rally pushed the yield on the benchmark 10-year note to its lowest level in 39 years.
The policy-setting Federal Open Market Committee voted to leave the key federal funds rate unchanged at 1.75%, a 41-year low.
But the panel altered its assessment of the economic outlook, saying risks to the economy no longer are "balanced." The risk of too-slow economic growth is again greater than the risk of higher inflation, the committee said. The language implied the Fed is prepared to cut interest rates, possibly as early as Sept. 24.
"The softening in the growth of aggregate demand that emerged this spring has been prolonged in large measure by weakness in financial markets and heightened uncertainty related to problems in corporate reporting and governance," the Federal Open Market Committee said, after a unanimous vote.
That prospect "makes it very difficult for anyone to be underweight Treasurys at this point," said Sadakichi Robbins, head of global fixed-income trading at Bank Julius Baer in New York.