Concerns about rates cause Dow to tumble

Average closes at 10,621, down 69.02 points

most world markets fall

June 11, 1999|By BLOOMBERG NEWS

NEW YORK -- U.S. stocks fell with bonds yesterday on concern that today's reports on retail sales and wholesale prices will prompt the Federal Reserve to raise interest rates at its meeting at the end of the month.

The Dow Jones industrial average recovered 95 points of a 164-point decline in the last half-hour of trading after Fed Chairman Alan Greenspan did not mention interest rates in a commencement speech at Harvard University.

The Dow finished down 69.02 to 10,621.27.

Computer-related shares such as Microsoft Corp., consumer-products maker Procter & Gamble Co. and J. P. Morgan & Co. led a decline that extended to every major stock index in North America.

The Standard & Poor's 500 index fell 15.82 to 1,302.82, with Microsoft contributing most to the decline. The Nasdaq composite index lost 34.73, or 1.4 percent, to 2,484.62.

Elsewhere on the broad market, the Russell 2,000 index, a benchmark of small-cap stocks, slid 2.92 to 442.27; the Wilshire 5,000 index skidded 138.97 to 11,982.01; the American Stock Exchange composite index lost 4.74 to 768.25; the New York Stock Exchange composite index dropped 6.43 to 622.85; and the S&P 400 midcap index fell 2.14 to 400.91.

The Sun-Bloomberg Maryland index sank 2.10 to 189.97.

Two stocks fell for every one that rose on the New York Stock Exchange, where about 716.6 million shares traded.

Most stock markets fell worldwide. An exception was the Japanese Nikkei 225 Index, which rose after Japan said its economy grew last quarter at the fastest pace in three years, fueling concern inflation will accelerate throughout the world.

The Dow average has lost 288 points since Monday as the yield on the U.S. 30-year bond climbed above 6 percent for the first time in 13 months. Yesterday, the yield rose 4 basis points to 6.06 percent.

Microsoft dropped $2.4375 to $79.875; America Online Inc. lost $5.25 to $105.75; and Dell Computer Corp. fell $1 to $34.50. Gateway 2000 Inc. fell $3.1875 to $58.8125, and network provider Cisco Systems Inc. lost $3.3125 to $110.4375.

Internet stocks posted some of the biggest declines. Digital River Inc., which helps software providers sell their wares on the Internet, sank $4.625 to $23.50. Mpath Interactive Inc., which operates World Wide Web sites and provides software for online game-playing, lost $1.625 to $19.875.

Online brokerage Charles Schwab Corp. dropped $2.1875 to $98.25.

J. P. Morgan fell $2.625 to $127.25; Chase Manhattan Corp. dropped 68.75 cents to $73.125; and American Express Co., the world's biggest charge-card issuer, lost $2 to $123.125.

Pfizer Inc. dropped $5 to $99.9375 after analysts said government restrictions on the drugmaker's Trovan antibiotic will hurt Pfizer's profits. The U.S. Food and Drug Administration said yesterday that Trovan should be used only to treat patients with serious or life-threatening illnesses because of concerns about liver problems.

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