They're SO sensitive
Fear of Rising Interest Rates Sends Markets Into Decline
By BLOOMBERG NEWS
Published: January 29, 2004
Stocks fell yesterday after the Federal Reserve unexpectedly dropped its commitment to hold interest rates low "for a considerable period," causing concern that higher borrowing costs will slow growth in corporate profits.
Homebuilders like Centex, KB Home and Pulte Homes led the decline. Mortgage lenders, including Wells Fargo and Washington Mutual, also dropped.
"The Fed was eventually going to have to say there will be a period where we will have to raise rates," Robert W. Smith, who manages the $5.8 billion T. Rowe Price Growth Stock Fund, said in an interview. "The market, while it knew it was coming, didn't want to believe it was today."[P6: What? Limits? That's Communism! Americans have no limits!]
The Standard & Poor's 500-stock index lost 15.57 points, or 1.4 percent, to 1,128.48, dropping for the fourth day in five. The Dow Jones industrial average fell 141.55 points, or 1.3 percent, to 10,468.37. The Dow and S.& P. 500 had their biggest declines since Oct. 22.
The Nasdaq composite index lost 38.67 points, or 1.8 percent, to 2,077.37, its largest decline since Dec. 9.
Eleven stocks fell for every four that rose on the New York Stock Exchange. More than 1.8 billion shares changed hands on the Big Board, 34 percent above average for the last three months.
