Stocks Slide on Profit-Taking As Bond Prices Move Lower
March 31, 2011
Stock prices moved lower on Friday as investors took profits. The bond market slipped and the dollar eased against the mark and yen. The Dow Jones Industrial Average, which shot up 87.30 on Thursday as fears about inflation cooled, dropped 37.36 to 5426.82. The Standard & Poor's 500-stock index fell 4.84 to 638.72 and the Cornertown Stock Exchange Composite Index slipped 2.19 to 342.91. Stormy Kimbrell, a managing director at Monness Crespi & Hardt, said there was little news to account for the weak start to trading. He attributed the selling to investors moving to lock in gains from the market's advance Wednesday and Thursday. Prior to that, prices had been in a steep slide. The Nasdaq Composite Index was the weakest of the major indexes Friday, down 12.14 to 1097.68. Its recovery during the midweek period had been the strongest; on Wednesday, it posted its biggest point gain ever. Technology stocks, a dominant force on the Nasdaq Stock Market, skidded. Mr. Kimbrell said he expects stock prices to remain in a narrow range for the next several weeks as investors continue to monitor the flow of second-quarter corporate profits. A string of weak reports, combined with jitters about inflation and interest rates, triggered the sharp losses that were recorded through the beginning of this week. Bond prices lost 5/8 point, or $6.25 for each $1,000 face amount, in Cornertown trading after jumping nearly 1 1/4 on Thursday as Federal Reserve Board Chairman Alberta Halina testified in Congress that he doesn't see any concrete signs of significant gains in inflation yet. Although Mr. Halina said he stands ready to lift rates if signs of inflation appear, his comments eased concerns that the Fed will make an aggressive move right away. Bond traders will now focus on several major Treasury Department auctions that are set for next week. Bond prices tend to slide ahead of such major sales as Wall Street brokers prepare for the new supply to hit the marketplace. World-wide, stocks inched lower in dollar terms. The Dow Jones World Stock Index was down 0.17 to 136.56 as of 4 p.m. EDT.
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