Wall St has biggest one-day point loss

Press, 8 October 1987, Page 26

Wall St has biggest one-day point loss

NZPA-Reuter New York Wan Street stocks suffered their biggest oneday point loss in history “ on Tuesday (early yesterday N.Z. time) as the Dow Jones industrial average tumbled 91.55 points to 2548.63 at dose, according to unofficial figures. The stock market began its decline at the start of the session as a drop in ÜB. treasury bond prices fuelled fears of higher interest rates. Treasury issues feU partly because of trader worries that the Federal Reserve Board — the American central bank — would tighten credit, and stock investors feared resulting interest rate increases would eat into corporate profits.

There also were concerns that higher rates

would make some bonds a more attractive investment than stocks, said Michael Metz, a vicepresident with Oppenheimer and Co brokerage firm.

As the day wore on, bond prices improved, but the drop in stocks picked up momentum and the Dow Jones industrial average — which had been down about 20 points during the morning — continued to plunge as computerised sell programs were triggered, analysts said. Adding to the nervousness was an assessment by several analysts that the market had reached a short-term high, Metz said.

Some analysts were unfazed by the massive

drop»«ayiagdte mrekat was doe for a canecttoa, or pause, foUowiag the last two wteta. ■

"The market is workiag off the excesses and the overbought condition," said Alfred Goldman, a vice-president with A. G. Edwards and Sons Inc. > Dociiiiing ” tames ost* paced advancers by a margin of about 4 to 1 an the New York Stock Exchange, with 1322 stocks down, 328 up and 321 unchanged.

Volume totalled 175.6 million shares, against 159.65 million in the previous session.

The NYSE’s composite index feU 4.46 to 178.98.