Newspaper article THE JOURNAL RECORD

Program-Trading Helps Stock Market Avoid Heavy Losses

Newspaper article THE JOURNAL RECORD

Program-Trading Helps Stock Market Avoid Heavy Losses

Article excerpt

NEW YORK (AP) - The stock market closed slightly lower Monday, helped by a late burst of computerized program-trading that wiped out much of what had been heavier losses during most of the day, analysts said.

The Dow Jones average of 30 industrial stocks, down more than 7 points throughout most of the session, closed , down 2.67 from Friday.

With a half-hour to go, the closely watched index had been off by 9 points.

Decliners outpaced advancers by about 9-to-5 on the New York Stock Exchange, with 1,045 issues lower, 576 higher and 450 unchanged.

Big Board volume totaled 157.61 million shares, down sharply from Friday's record 244.68 million shares.

Ralph J. Acompora, an analyst at Kidder, Peabody & Co., said some program trading at the end of the session cut most of the losses in a market that was recovering from Friday's ``triple witching hour'' 16-point runup.

He said there was a lot of selling throughout the day because ``the pop at the very end of the session Friday led to some unreal prices.''

The ``triple witching hour'' occurs four times a year, when stock index options, regular stock options and stock index futures all expire at the same time.

On those four days, traders must neutralize their holdings by the end of trading - which can easily lead to heavy waves of buying or selling.

Friday's trading resulted in a record volume of 244.68 million shares, with the biggest boost coming in the final minutes.

Monday morning, a leftover imbalance between the cash market and the nearby March Standard & Poor's 500 stock index future contract encouraged some computerized program-selling that helped pull the market down, said Michael Metz, an analyst at the Openheimer & Co. …

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