Wall Streeters Bite Their Nails and Wait With AM-Stock Market, Bjt
NEW YORK (AP) _ Robert Young ducked out of the New York Stock Exchange on Thursday for a smoke and contemplated the question of the day: Was the market’s decline this week the end of the 3 1/2 -year bull market, or just a correction?
″If I knew that, I’d be rich,″ the trader said with a shrug as exchange workers around him discussed the drop over sandwiches or cigarettes.
Some were optimistic. ″My instincts tell me it’s just a correction,″ said Daniel Rice, a floor broker. ″I think it’s going to go back up.″
Then he added the crucial element: ″In the next few months.″
Joseph Bonondona, a broker and president of his own firm, Northport Securities, was more philosophical. ″After the market’s been up so much in the last few years, a few down days won’t hurt anybody,″ he said.
By mid-afternoon, heavy selling had weakened the market for a sixth straight day. The Dow Jones average of 30 big-name stocks, the best-known barometer of the market, rose about 20 points, then plummeted 70 points and came back closed up 9.21 at 3,635.96.
The Dow, however, ended the holiday-shortened week down nearly 139 points, its worst weekly drop in more than four years.
″Like everyone else, I’m biting my nails, and that’s the truth,″ said a member of the stock exchange who would not give his name. ″It’s so volatile today. It was down 15, then I turned around and it was down 25.″
Outside the white marble building in Lower Manhattan, passers-by stopped anyone coming out of the building - janitors with brooms, or traders wearing ties - to ask, ″Up or down?″
Salvatore Saladini, a trader who worked during the crash of 1987, blamed the decline on a pack mentality.
″The single biggest reason this happens is that people jump on the bandwagon, play follow the leader,″ he said. ″People panic. But what we saw in ’87 will never happen again. Nowadays, the market can handle a lot more volatile swings.″
The market decline early Thursday triggered a so-called circuit-breaker rule that limits high-volume computerized trades when the average falls or rises 50 points. The rule was instituted after the ’87 crash to curb volatility.
″Who knows what it means? It could be a correction,″ said Gene Petersen, an independent broker. ″But I make my money either way, so I hope the volume keeps up.″
″It’s a correction, just end-of-the-quarter selling,″ said trader Christopher Connors. ″I think the worst is over already.″