Asia, Clinton Worries Hit Dow, Bonds
Stocks and bonds fell Friday, and the dollar hit its lowest level against the Japanese yen in two months as Wall Street worried about White House sex allegations, corporate earnings and the Asian economic crisis.
Oil prices dropped below $16 a barrel for the first time in nearly four years as forecasts for a continued mild winter combined with swelling supplies to fuel heavy selling in futures markets.
The Dow Jones industrial average fell 30.14 points to 7,700.74, recovering from a drop of 88 points earlier in the session. The index’s third straight decline brought its loss to 52.81 in the holiday-shortened trading week.
“The market still seems concerned with Asia and what’s going on in Washington,” said Harry Laubscher, market analyst at Tucker Anthony.
Broader indicators also pulled back again, pressured by the nagging worries about how much the Asian crisis will hurt U.S. companies and mounting concerns over whether the latest allegations of sexual improprieties by President Clinton will impair government initiatives at home and abroad.
Notably, the technology sector suffered only marginal damage despite more disappointing profit reports from the group, many of which cited the Asian crisis. Analysts said computer-related shares have already been battered down to levels that are too appealing for bargain hunters to resist.
But financial shares, the other group considered particularly vulnerable to the turmoil overseas, took another drubbing: J.P. Morgan fell $3.44 to $88.44 as the Dow’s weakest component.
Interest rates took a turn for the worse in the bond market.
Declining issues outnumbered advancers by a 12 to 7 margin on the New York Stock Exchange, where volume continued at the hectic clip that has characterized the market since the second trading day of the year. NYSE volume totaled 635.77 million shares, the 13th time in 15 sessions this year that more than 600 million shares have changed hands.
The Standard & Poor’s 500-stock list fell 5.45 to 957.59, and the NYSE composite index fell 3.11 to 500.68. The Nasdaq composite index fell 0.58 to 1,575.93. The Russell 2,000 index of smaller companies fell 1.39 to 424.81.
Bonds were pressured by supply concerns in advance of next week’s auction of new Treasury securities, as well as this week’s unsettling developments in Washington, said Ned Riley, chief investment officer at BankBoston.
The 30-year Treasury fell, raising its yield to 5.97% from 5.87% Thursday. Bond prices and yields move in opposite directions.
Among Friday’s highlights:
* Computer stocks gained, helping prevent further losses. Gateway 2000 jumped $3.13 to $37.13 after the maker of personal computers hired a top AT&T; Corp. executive as its president and reported unexpectedly strong fourth-quarter earnings.
Rival Compaq Computer rose 63 cents to $31.75, and Dell Computer gained $2.31 to $94.81.
The day’s most active stock was Iomega, which tumbled 20 cents to $8.81 after posting disappointing results late Thursday.
* Cable TV stocks fell on concern that a nine-month rally that caused share price to more than double has little room to run, analysts said.
Cablevision Systems shares fell $3.06 to $90.94, Cox Communications fell $1.25 to $38.13, and US West fell 38 cents to $28.25.
* Concern about events in Washington pushed gold to the highest levels in two months--boosting stocks in gold-mining companies. Newmont Mining Corp. rose $3.38 to $30.06, Homestake Mining rose 69 cents to $9.56, Agnico-Eagle Mines rose 88 cents to $6.38, Placer Dome rose $1.25 to $13.38, and Barrick Gold jumped $1.44 to $19.06.
Gold for February delivery jumped $9.10 to $299.90 an ounce on New York’s Commodity Exchange.
In currency trading, the dollar fell to 125.57 Japanese yen late in New York from 127.23 late Thursday. It was the lowest against the yen since the dollar bought 124.86 yen Nov. 21.
Market Roundup, D4
