Stocks Dive on More Corporate Fears
Reuters
NEW YORK (July 10) - Stocks tumbled on Wednesday to lows last seen in 1997 as investors ran from equities -- still considered too costly in light of heightened risk associated with dubious accounting.
The latest reason for anxiety came from Qwest Communications International Inc., whose accounting practices are already being probed by federal regulators. The No. 4 U.S. local phone company said on Wednesday that federal prosecutors have launched an unspecified criminal investigation of the telecommunications company.
''There are no buyers and that's a proxy for a major lack of confidence in U.S. companies,'' said Gary Wedbush, head of trading at Wedbush Morgan in Los Angeles. ''The Qwest news is just a reminder in a long list of reminders.''
The broad Standard & Poor's 500 fell 32.36 points, or 3.4 percent, to 920.47, according to the latest data, the lowest finish since October 1997. The Nasdaq composite index tumbled 35.10 points, or 2.54 percent, to 1,346.02, the lowest close since May 1997.
The Dow Jones industrial average fell 282.59 points, or 3.11 percent, to 8,813.50, the largest decline since late September 2001.
Among individual issues, Qwest fell 32 percent, or 83 cents, to close at $1.77.
Also, Royal Dutch slumped 9.2 percent, or $5.16, to $50.73, after the oil company and six other foreign firms were yanked from the S&P 500 index to be replaced with seven U.S. companies. Money managers dumped the foreign shares to make room for the new members of the widely followed index. |
