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The Sharp Losses in US Stocks after 9.11 Terror

Posted June. 16, 2002 08:40,   


According to the Financial Times published on June 14, US stocks battled back from the sharpest losses following a raft of downbeat news after 9.11 terror. Consumer sentiment Index was sharply declined and the increase of industrial productivity was stopped after terror. Uneasiness on US Economy was raised.

In the New York stocks, indices sank at the open with the S&P 500 falling below the psychological 1,000 mark (off 27.93 to 981.63. By the close, however, the indices had erased most of their losses, with the S&P 500 closing down 2.30 at 1,007.28 after the last September.

The Dow Jones industrial average was off 28.59(0.30%) at 9,474.21 (once off 241.40), while the Nasdaq Composite managed to eke out a small gain, up 7.88 at 1,504.74(0.53%) by the close. For latest 2 weeks, S&P index was off 6%, Dow Jones Industrial average was off 5% and Nasdaq Composite was off 7%. The University of Michigan`s consumer sentiment index for mid-June disappointed investors as it dropped to 90.8 from May`s 96.9 reading by a drop of 6.1. It was the largest drop since the drop of 9.7 due to 9.11 terror.

The Federal Reserve, on June 13, reported that US industrial production rose 0.2 per cent in May, slightly below the expected 0.3 per cent increase, and the retail selling was down 0.9% since November, 2001.

European indices closed at the lowest level with the drop for four days based on technology stocks and telecom stocks.

FTSE100 sank to 4,630.80, a drop of 141.20 (2.96%) over the last day. The index was the lowest value after the last September. CAC 40 was closed down 2.9% and DAX was off 3.72% as the lowest value.

FINANCIAL TIMES analyzed that stocks were declined caused by suicide bombing in Pakistan and a sharp fall in consumer confidence, downward of investment rating of telecom stocks and forecasted depression of UK insurance industry.

BLOOMBUG forecasted that the GDP growth of America of the second quarter would be to 2.9%. It is a half of the growth (5.6%) of the first quarter.