Newspaper article THE JOURNAL RECORD

Rebound in Oil Stocks Helps Blue Chips Recover

Newspaper article THE JOURNAL RECORD

Rebound in Oil Stocks Helps Blue Chips Recover

Article excerpt

NEW YORK (Bloomberg) -- U.S. stocks fell Wednesday as companies including Atmel warned that fourth quarter profits will disappoint. A rebound in oil stocks from a two-day slump helped the Dow Jones Industrial Average pare a 129-point loss to 4 points.

"There's a certain amount of skepticism among investors as to exactly how earnings will bear out" in the weeks ahead, said Jim Griffin, an investment strategist at Aeltus Investment Management in Hartford, which oversees $45 billion. "This is a rich market" after three straight years of gains exceeding 20 percent.

The Dow closed at 7902.27, down 3.98. The Standard & Poor's 500 Index lost 2.58, or 0.3 percent, to 964, and the Nasdaq Composite Index dropped 18.44, or 1.2 percent, to 1561.7. Atmel, which depends on Asia for 45 percent of its sales, led a retreat in computer shares. The specialty-chip maker fell 2 to 17 3/8 after saying some of its customers in the region couldn't find financing to buy its products. Other technology companies also have warned that earnings from Asia will be poor. Asia's plunging currency and stock markets have cast a pall on the U.S. market since October, because investors are concerned that U.S. exporters' earnings will suffer. Teledata Communications, a maker of telecommunications equipment, dropped 8 1/8 to 111 5/16 after forecasting "moderate" growth for 1998 because of a slowdown in Southeast Asia. Other companies also warned of earnings shortfalls, for reasons that had nothing to do with Asia. HCC Insurance Holdings Inc. fell 3 7/16 to 16 1/2 after the company told analysts to trim profit estimates for 1998. Rainforest Cafe plunged 12 3/16 to 18 9/16 after warning of disappointing results, and was the most actively traded stock. "The market's going to continue to suffer from these negative surprises," said James Pizzo, senior portfolio strategist at CIBC Oppenheimer in New York. "The attitude of the buyer now is to step back when a company disappoints to see how things settle out. When the market was roaring, investors stepped up to buy because they were betting the stock would rebound. …

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