Posted on: Friday, August 13, 2004
Stock indexes plunge to new lows for year
By Michael J. Martinez
Associated Press
NEW YORK — Rising prices for crude oil and disappointing earnings from Hewlett-Packard Co. sent stocks plummeting yesterday, with all three major indexes sinking to new year-to-date lows.
Hewlett-Packard was the latest in a string of technology companies to disappoint Wall Street with second-quarter earnings. Like Cisco Systems Inc. and National Semiconductor Corp. earlier this week, HP said its third quarter would be grim.
Mixed economic news did little to help matters. The Labor Department said first-time jobless claims moved to a five-week low, perhaps signaling some moderation in a very disappointing job market.
But the Commerce Department reported that business inventories rose by 0.9 percent in June, the biggest jump in four years — a sign that businesses are having trouble moving products off the shelves.
The department also reported a 0.7 percent increase in retail sales for July, up from a 0.5 percent decrease in June but less than the 1 percent gain expected.
Declining issues outnumbered advancers by nearly 3-to-1 on the Big Board, where consolidated volume came to 1.74 billion shares, compared with 1.74 billion on Wednesday.
Crude surged past $45 per barrel — trading at $45.50, up 70 cents, on the New York Mercantile Exchange. That raised concerns that the Federal Reserve would have to be aggressive in further rate increases to combat inflation — at the same time when earnings growth and the economy is slowing down.
