u.s. stocks fall after news of bin laden audiotape

  1. 1,155 Posts.
    Reuters
    U.S. stocks fall after news of bin Laden audiotape
    Tuesday February 11, 3:26 pm ET
    By Haitham Haddadin


    (Updates to late afternoon)
    NEW YORK, Feb 11 (Reuters) - Stocks fell across the board late on Tuesday afternoon after news of a statement from fugitive Saudi-born militant Osama bin Laden reignited investor jitters that war with Iraq was drawing near.

    ADVERTISEMENT


    Also weighing on the market was Federal Reserve Chairman Alan Greenspan's cautious outlook on the world's largest economy.

    Stocks fell after al-Jazeera satellite television channel said on Tuesday it had received a statement from bin Laden urging Muslim solidarity with Iraq. U.S. Secretary of State Colin Powell said the audiotape suggested further links between global terrorism and Iraq.

    "It has everything to do with the bin Laden headline," said Peter Boockvar, equity strategist, at Miller Tabak & Co., referring to the decline in stocks. "The market turned around when Powell spoke about the tape. It has everything to do with this."

    The blue-chip Dow Jones industrial average (CBOT:^DJI - News) added to losses, falling 112.17 points, or 1.42 percent, to 7,807.94. The broader Standard & Poor's 500 Index (^GSPC - News) was off 10.88 points, or 1.30 percent, at 825.09. The tech-laced Nasdaq Composite (NasdaqSC:^IXIC - News) shed gains, and was last down 10.57 points, or 0.82 percent, to 1,286.11.

    The S&P 500 broke a four-day losing streak on Monday.

    An audiotape broadcast on al-Jazeera and said to be from bin Laden urged Muslims to fight America and repel any attack on Iraq.

    "Everybody is basically waiting on the sidelines in a market like this with all these rumors about links between al Qaeda and Iraq," said Steve Milona, a trader at HSBC Securities. "Volumes are particularly weak today. There is just a lot of money on the sidelines. We are not hearing a lot of clients calling up with trading ideas or anything."

    Greenspan, in testimony before the Senate Banking Committee, said that uncertainties created by possible war with Iraq posed "formidable barriers" to business spending and clouded the economic outlook.

    Dow stock SBC Communications Inc. (NYSE:SBC - News) fell 63 cents to $23.87 cents, 2.6 percent, a day after the No. 2 U.S. telephone company was being pummeled by talk that it may be interested in buying Hughes Electronics Corp.'s (NYSE:GMH - News) DirecTV unit.

    Semiconductor shares were showing some strength after Texas Instruments Inc. (NYSE:TXN - News), the top maker of semiconductors for cell phones, on Tuesday reaffirmed that it expects first-quarter earnings of about 6 cents per share.

    Texas Instruments rose 47 cents to $15.55, and the Philadelphia Stock Exchange's semiconductor index (Philadelphia:^SOXX - News) was up more than 1 percent, having earlier climbed 2 percent.

    Among active issues, Web gear giant Cisco Systems (NasdaqNM:CSCO - News) rose 33 cents to $13.48, or 2.5 percent, and was the most active stock on Nasdaq.

    But nagging questions over the timing and duration of a potential U.S.-led attack on Iraq and the impact on the U.S. economy were keeping Wall Street in a sober mood.

    Greenspan also warned of the need for curbs on deficits and spending in a speech delivered at a time of wrangling among lawmakers over the Bush administration's proposed $695 billion, 10-year tax package.

    Aetna Inc. (NYSE:AET - News), which ranks second behind UnitedHealth Group Inc. (NYSE:UNH - News), said it swung to a profit on steeper premiums and cost cutting. It rose $1.34 to $43.19.

    MetLife Inc. (NYSE:MET - News) fell $1.26, or 4.8 percent, to $24.74. The No. 1 U.S. life insurer has reported a quarterly profit against a year-earlier loss, helped by gains from real estate sales, but MetLife took an unexpected charge as it boosted its estimate of the costs of settling asbestos claims it faces.

    Scholastic Corp.(NasdaqNM:SCHL - News), U.S. publisher of the popular Harry Potter books, slumped $7.78 to $25.88 after it warned that its third-quarter and full-year results would fall short of expectations due to weaker-than-expected January sales.

    Shares of LeapFrog Enterprises Inc. (NYSE:LF - News), a maker of educational toys, fell more than 16 percent on Tuesday, a day after the company forecast earnings for the year that disappointed Wall Street. LeapFrog fell $3.67 to $20.88.



 
arrow-down-2 Created with Sketch. arrow-down-2 Created with Sketch.