Dow falls 41.73 to lowest close since April 13

June 18, 1992|By Bloomberg Business News

NEW YORK -- Stocks skidded again yesterday as election jitters sent a volatile market tumbling.

The Dow Jones industrial average fell 41.73, to 3287.76, its lowest close since April 13, after falling 25.41 points Tuesday. Declining issues swamped advances by 6-to-1 on the New York Stock Exchange.

Besides the slumps in the Japanese and Mexican markets, U.S. shares were buffeted by a new Associated Press poll that showed strong popular support for unannounced presidential candidate Ross Perot, said Richard Meyer, head of institutional trading at Ladenburg Thalmann.

"There is certainly a concern about the election," given Mr. Perot's rising support, said Barry Berman, head trader at Robert W. Baird.

Analysts said perceptions that Mr. Perot would oppose a North American trade agreement were a factor in yesterday's slide in Mexican stocks, which carried over to the United States.

Investor sentiment, already hurt by Tuesday's slide in U.S. stocks, was further damaged by a 3 percent drop in Japanese equities overnight. Tokyo's Nikkei 225 index plunged 507.73, to 16,445.80, its lowest close in nearly six years, amid an increasingly pessimistic outlook for the Japanese economy.

U.S. share prices zigzagged much of the day, reflecting portfolio adjustments tied to Friday's quarterly expiration of stock options, index options and futures, traders said.

Computer-guided sell orders knocked about 47 points off the Dow, said Birinyi Associates.

"It started with [Tuesday's] selling," said Berman of Robert W. Baird. "The market finished weak, and that carried over to Tokyo."

Stock investors took no encouragement from the Federal Reserve's "beige book," a periodic survey of regional economic conditions that revealed a resurgence in manufacturing across the nation.

Despite that, "people are just recognizing the recovery is slow in coming and it's not all that broad-based," said Dale Tills, manager of institutional equities trading at Charles Schwab.

Interest rates probably won't fall much further, and second-quarter earnings won't be enough to buoy stock prices, he said.

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