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Dow declines 51.83 to 9.067.94; Nasdaq advances .65 to 1,605.95

Aired October 8, 2001 - 15:56   ET


LOU DOBBS, CNN ANCHOR: I am Lou Dobbs in New York and we're just moments away from the closing bell on the New York Stock Exchange. Stocks today poised to finish lower on the day, investors dealing with a second round of air strikes against the Taliban in Afghanistan. Both the Dow and the Nasdaq spending the majority of the trading session below break even.

At one point, however, the Dow was down more than a hundred points. But it since has recovered about half of that. For more on the session, we're going to Rhonda Schaffler standing by at the New York Stock Exchange, Greg Clarkin at the Nasdaq, standing by, every bit as live. Rhonda, we begin with you.

RHONDA SCHAFFLER, CNN CORRESPONDENT: Lou, one trader walked by and he said, down 56, and not bad. And not bad seems to be the general assessment about this trading day. Keep in mind, the Dow had run up significantly ahead of these military strikes against Afghanistan. The stock market anticipated military strikes. That's why we didn't have a bigger sell off.

You can see how the Dow performed. Fairly choppy but well off the lows of the session. The reason the market doesn't rally from here, according to traders and analysts I talk to, is while the strikes end some bit of uncertainty, there are other questions raised about how long the military action will be. Will there be any retaliatory action against the U.S., and if the conflict would spread, would oil supplies be disrupted?

That's why the market still remains a little bit edgy. The fact that the Dow recovered lows and held its own is making traders feel pretty confident about the way the market responded to the attacks -- Lou.

DOBBS: Rhonda, how are the oil stocks doing? Since there is apparently some particular interest in the market in those stocks.

SCHAFFLER: The oil is performing pretty well. You did see buying in a couple of sectors today: some tech stocks, some defense stocks, and some consumer products stocks. So there were buyers here, Lou.

DOBBS: Oil prices little changed, so there is not that much concern about those oil supplies, one would infer? SCHAFFLER: No. In fact, the conflict would have to worsen. And we are nowhere near that and oil prices have dropped significantly in the last few weeks.

DOBBS: Terrific. Rhonda, thank. We will go back to you in just a minute. We are about less than a minute away from the closing bell. We are going to go over to Greg Clarkin who is at the Nasdaq Market -- Greg.

GREG CLARKIN, CNN CORRESPONDENT: Lou, a very subdued, cautious trading session today. If you look at the volume, 1.3 billion shares traded. That is about half of what the Nasdaq did on a couple of the busier days last week. You can see the composite just kind of in a drifting mode. At its worst it was down 30 points early on. At its best, it was up 15 points around midday. Once the news reports came out, of the military strikes, you saw the Nasdaq just kind of drifting in volume, even drift a little bit lighter than we had seen on this Columbus Day holiday -- Lou.

DOBBS: OK, Greg. Just about, oh about 20 seconds away from the closing bell. There on the balcony, the retiring member, Anthony Ales, honored today. As Rhonda and Greg have said, finishing lower on the day. There's the bell. And stocks officially finishing lower on Wall Street. Strength seen in the defense, oil and certain tech sectors while the retail and cyclical issues were somewhat weaker on the day.

Rhonda, let's go back to you. This day could have been far worse.

SCHAFFLER: It really could have been. And, you know, the sell- off today was not one of nervousness, just like we saw on the Nasdaq volume, here. I mean, it's light. It's not even a billion shares here as the closing bell rings. And even if the bond market is open or closed, if people want to get in and sell, they would do that. You did not see that here. You saw a market move lower. And the expectations were, even before this trading week, because of the gains the past two weeks, the market would give some back.

There were some groups, as you mention, though, that were under pressure. Retailers, interesting, because we had some brokerage calls on the session and retailers saying that some of these companies are going to see their sales impacted from the terrorist attacks. In fact, we'll get a big retail sales number later in the week.

You can see how the group performed. Even Target and Wal-Mart stores selling off a bit, and those two seen as more defensive in the retailing sector, because the discounters tend to hold up better in an economic slowdown.

Defense stocks, though, continued their climb. The group pretty much moving higher with just one or two exceptions. Lockheed Martin up $1.39, Boeing up 46 cents. It's still trying to recover. It hasn't had the run that these other stocks have. Ratheon, Northrop Grumman closing up on the day, and of course the expectation is there will be increases in defense spending going forward -- Lou? DOBBS: All right, as you say, Rhonda. But nearly every expert, analyst, if you will, that we talk with, says that this is a different kind of war, a new war, in which those stocks are not likely to be big beneficiaries of any defense spending.

SCHAFFLER: Well, it's interesting, because Wall Street doesn't always think rationally on certain moves. And that's been the one group people flock to, almost a knee-jerk reaction, to buy some of those defense stocks. There will have to be parts replaced, there will have to be some buying. And that's what attracted interest today.

DOBBS: Terrific, Rhonda. Thank you very much.

Turning over to Greg Clarkin at the Nasdaq -- despite a negative close, some positives in that market -- Greg?

CLARKIN: Indeed, Lou. We saw the Nasdaq after a full day of trading pretty much back to where it began the session this morning, up less than 1 point at the moment.

Let's take a look at the big caps. Give you an idea of how the big game technology shares did on the day. You can see this group of four were higher. Microsoft, Intel, up 20 cents. Cisco and Dell Computer higher. There were also some of the stocks that really continue to run up over the last few weeks are technology companies that are into kind of the security end of things. Visage Technologies -- these folks make facial recognition systems. Small company, $139 million market cap, but a big pop today, up 482. Envision Technologies -- they make explosive detection systems for airports. They're up 2.59. Magal Security -- they make perimeter security operations. They're up almost 2 bucks. Northwest, though, continues to struggle. That stock was around 20 back before the attacks on the World Trade Center and the Pentagon. You can see where it is today, continues to lose ground. Now down around $11 a share -- Lou?

DOBBS: Basically, a flat finish over on the Nasdaq. Greg, thanks a lot. Greg Clarkin.

Well, that is the latest on the markets. Please join us again at 6:00 Eastern Time on "MONEYLINE," when we go through the day's activity on Wall Street. And among our guests tonight, economist Lakshman Achuthan will be joined by former NATO Commanding General Wesley Clark.

Until then, I'm Lou Dobbs in New York.




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