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Dow Sinks As Corporate Losses Due to Asia Appear Certain
PR Newswire - December 10, 1997 17:33
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NEW YORK, Dec. 10 /PRNewswire/ -- Share prices fell, paced
by losses in technology stocks and banks as certainty builds that
earnings in these sectors will be hurt from market exposure in Asia,
Market News Service reported Wednesday.
The Dow Jones industrial average dropped 70.87 to 7978.79 while
the Standard & Poor's 500 index went down 5.99 to 969.79. Volume on
the New York Stock Exchange was 601 million shares, with 999
advancing, 1,959 declining, and 477 unchanged.
Shares dropped as JP Morgan admitted that its earnings have been
hurt by the Asian financial turmoil. Together with Oracle's bad earnings
forecast earlier this week it persuaded investors that their worries
were well founded over the Asian crisis's impact on U.S. corporate
profits.
Moreover, worries over Asia deepened Wednesday as a sharp drop in
South Korea's currency further undermined the country's economy and
caused declines of 4.1% in Hong Kong and 1.3% in Tokyo overnight.
Investor jitters over Japan were further increased by the absence of
certainty over financial reforms package and by circulating rumors
that yet another Japanese investment bank is going out of business.
Report by the blue-chip J.P. Morgan that it faces a decline in its
fourth quarter earnings caused the company's shares to drop by 5 1/8,
or 4%, to 117 3/4. It also pulled down shares of other banks, causing
Citicorp with its vast emerging markets exposure to shed 6 1/2, or 4%,
to 131 3/8 and bringing Bunkers Trust down by 1 11/16 to 127 1/2 and
Lehman Brothers by 2 1/16 , or 3.8%, to 51 1/8.
Microsoft lost 2 7/16 to 141 7/8 after the company said late on
Tuesday that it feels an impact of slowdown of computer sales in Asia,
reinforcing investor fears.
Dow component IBM lost 3 7/8, or 4%, to 106 1/2.
Traders said, adding to declining demand in Asian countries, U.S.
semiconductor companies are going to face a threatening competition
from cheapened Asian rivals - a concern which caused losses in
companies like Texas Instruments down 7/8 to 44 3/8, Intel down 1 3/16
to 74 7/16, Motorola down 2 1/8 to 60, Micron down 1 11/16 to 23 15/16.
Compaq Computer and Bay Networks were among most active stocks
losing 3 1/4, or 5%, to 60 1/8 and 2 3/8 to 25 3/16 respectively on
analyst downgrade.
Cisco Systems, the biggest networking company, lost 2 1/16, or
2.36%, to 85 3/8.
SOURCE Market News Service
/NOTE TO EDITORS: Market commentary from Market News Service is
transmitted on a daily basis by PR Newswire./
/CONTACT: Lara Burdess, or Mark Pender of Market News,
email: mark(at)mktnews.com /
CO: Market News Service
ST: New York
IN: FIN
SU:
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