Wall Street Gears Up for a Celebration but Decides to Wait Until Another Day
They never got to uncork the champagne Wednesday at Harry’s, the landmark tavern on Hanover Square that for generations has served as Wall Street’s favorite watering hole.
Proprietor Harry Poulakakos, anticipating “a big celebration,” had iced down a couple of extra cases after the Dow Jones industrial average staged a big rally Tuesday and closed within striking distance of 3,000.
Wednesday also proved a big disappointment for two dozen members of the news media who waited in vain for an appointment with history in the press gallery above the New York Stock Exchange’s cavernous trading hall.
“I’ve been here maybe 15 times,” said free-lance photographer Ed Quinn, picking up an easy $75 on assignment for Agence France-Presse. “No matter how many times you shoot it, it never changes.”
Let the academics and stock market experts say what they will about the Dow not being representative of the broader market. In the popular imagination, the Dow is the market. Even on Wall Street, where most people know better, the Dow’s assault on a major milestone like 3,000 sends a shiver of excitement through the most hard-boiled of players.
“Sure, it’s exciting,” admitted Lee Corcoran, head clerk for Corcoran & Corcoran, enjoying a smoke outside the Big Board’s Broad Street entrance Wednesday afternoon after the market had twice pierced 3,000, then retreated.
“There’s an energy and intensity on the floor,” he added. “Everybody is waiting for the closing above 3,000.”
“Three thousand is a tremendous milestone,” added Prudential Securities broker Joseph Murphy. “But what is even more important is that volume is high and firms are making money again. January and February were very profitable.”
Despite Wednesday’s disappointing finish, Murphy predicted that the Dow will close above 3,000 in a matter of days. That, together with the resounding allied victory in the Gulf War, should unleash a wave of consumer confidence that will lift the economy out of recession, he predicted.
“It’s a big psychological factor that will work its way down to the man on the street,” he said. “People feel their wealth in their homes and in their stocks and mutual funds. And all of a sudden, they will be reminded that their stocks are at record high levels.”
Of course, not everyone views a closing above 3,000 as a foregone conclusion, and some believe that, even if it happens, the Dow could take a quick tumble.
“I think right now we’re in a totally overbought condition,” said Bob Fass, an independent floor broker. “Buying into this is very, very risky. When reality sets in and people realize we’re still in a recession, you could possibly see another ’87-style crash.”
Whatever the future, the past indicates that 3,000 is a major hurdle for the Dow. Wednesday marked the fourth day in history that the average failed to hold advances over that level. The first three times came last July, including back-to-back finishes tantalizingly close to 3,000 at 2,999.75 on July 16 and 17.
“I’ll never forget those days,” said a Kidder Peabody floor broker who asked to remain anonymous. “Everyone was expecting it to happen. (Former NYSE Chairman John J.) Phelan was even planning to ring the closing bell and throw a party up in the gallery. Maybe that’s what jinxed us.”
DOW ON THE QUARTER HOUR The Dow Jones industrial average briefly pierced the 3,000 level before falling as traders cashed in their profits. Wednesday’s High: 1:08 p.m. 3,002.72 Wednesday’s Low: 3:53 p.m. 2,963.37