Investors mostly shrug off the big downturn
Some winced, many shrugged, and others calmly got ready to buy.
But few of the men and women who’ve sent the stock market sailing with their savings and earnings showed much panic Monday as they watched the Dow Jones plunge.
``I’m a little nervous,″ admitted Bob Bilton, a semi-retired salesman in downtown Atlanta. ``But I’m a long-term investor. I’m not going to get excited.″
Gloria Humphrey, who described herself as a casual follower of the market, also preferred to take a long-term view.
``You have to ride it out, like a roller coaster _ and not panic like some people do,″ said the 35-year-old customer service representative in Columbus, Ohio. ``I know how to play the game.″
The Dow Jones industrial average dropped 554.26 points to 7,161.15, the biggest point loss ever for the blue-chip index.
Seeking to calm any possible panic, White House spokesman Mike McCurry described the drop as ``a bare fraction of major breathtaking drops in the past.″
Indeed, the loss of 7.2 percent was far less than plunge of 22.6 percent on Oct. 19, 1987. And when trading was automatically shut down for the day Monday, the Dow was still up 11 percent this year.
``We want everyone to just take a deep breath and think about where we are,″ McCurry said. ``This is a market that has performed amazingly well ... so let’s be calm and reasonable.″
For the most part, investors agreed as they watched the drop during the day.
``The market is strong,″ said Dave Gilley, a salesman for a software consultant who has investments both in stocks and through his 401(k) retirement plan.
``I think the U.S. economy is way too stable to be affected by global markets,″ he said, referring to the Hong Kong stock market downturn that inspired market jitters worldwide.
Craig McKernin, a doctor’s assistant in New York City, said he was surprised but unfazed at the depth of the day’s drop. ``I think it will go right back up,″ he said.
He said he wouldn’t change his investment strategy of buying speculative stocks unless the downturn continued.
Even on the floor of the New York Stock Exchange, traders were barely flustered. ``It was very quiet and orderly,″ said Joe Pettibone, a trader with the Boston firm of Adams, Harkins and Hill.
Alan Sarroff, an independent member of the Exchange, shrugged off the day. ``Now it’s time for the down. ... Is that the end of the world?″
And some investors were almost gleeful, saying they were ready to pounce on good opportunities to buy cheap stocks.
Steven Norwitz, vice president at T. Rowe Price Investment Services in Baltimore, said that investors were both buying and selling stocks Monday.
``Not too many people are asking for advice,″ he added. ``They’ve made up their minds one way or the other.″
A retiree who would give his name only as George said he was looking for bargains. ``I’ve got money to buy today and some of these things look attractive,″ he said as he sat in the offices of a Charles Schwab brokerage in Seattle.
As to whether bull market is over, he chuckled and replied: ``Nobody knows.″