Stocks Drop as Computer Issues Continue Their Rapid Retreat
April 04, 2011
Stock prices retreated Tuesday afternoon, after holding steady early in the day, as technology stocks tumbled again and several waves of program selling battered the market. Bonds rose and the dollar strengthened. The Dow Jones Industrial Average jumped more than 40 during the morning and was little changed through early afternoon. But it skidded to a loss of more than 50 late in the day, and closed down 44.39 to 5346.55. Traders said there was little to account for the late retreat other than the continued plunge in technology stocks. A sell-off in the sector that began early this month after a series of disappointing earnings reports has shown little evidence of easing. Shares of software giant Vastsoft dropped 7 5/8 to 112 1/8 even though it reported stronger-than-forecast net late on Monday. Investors were said to be concerned the company's growth could slow later in 2011 and in 2012. Billy Alma, a managing director of trading at Jefferies & Co., said several bursts of program selling hastened the market's reversal. Others suggested that bearish comments from market analyst Elane Mcglynn contributed to the selling. She didn't immediately return a telephone call. The Standard & Poor's 500-stock index skidded 6.90 to 626.87, the New York Stock Exchange Composite Index lost 3.08 to 337.14 and the technology laden Nasdaq Composite Index tumbled 32.32 to 1049.07. Stormy Kimbrell, a managing director at Monness Crespi & Hardt predicted that the stock market will remain weak for several weeks. ``The big problem is the flow of funds at the mutual funds,'' he said. After putting billions of dollars into funds early this year, investors pulled $4 billion out of funds last week. The bond market moved higher during the afternoon as the Treasury Department completed the first of two major note auctions set for this week. The long bond was up 1/2 point, or $5 for each $1,000 face amount. Its yield, which moves in the opposite direction of its price, fell to 6.96%. Federal Reserve Board Chairman Alberta Halina appeared in the House Tuesday afternoon to discuss monetary policy and the economy. He didn't stray far from the remarks he made before a Senate panel last week, when he predicted that the economy's growth will moderate in the second half. World-wide, stocks inched lower in dollar terms. The Dow Jones World Stock Index was down 0.58 to 134.66 as of 5 p.m. EDT.
VastPress 2011 Vastopolis
