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: Exit Poll Talk Hits the Stock Market
From: David Farber <dave () farber net>
Date: Tue, 02 Nov 2004 17:55:31 -0500
\Exit Poll Talk Hits the Stock Market November 2, 2004 By REUTERS Filed at 5:17 p.m. ET NEW YORK (Reuters) - Blue chips fell on Tuesday in a sharp reversal that trimmed gains in other indexes as Internet sites suggested exit polls had Sen. John Kerry ahead of President Bush in key states in the U.S. presidential election. The Dow Jones industrial average fell 18.66 points, or 0.19 percent, to end at 10,035.73. But the Standard & Poor's 500 Index eked out a gain of just 0.05 of a point, or unchanged from a percentage standpoint, based on the latest data, to close at 1,130.56, its sixth day of gains. The technology-laced Nasdaq Composite Index rose 4.92 points, or 0.25 percent, to finish at 1,984.79. All three gauges had been higher, with the blue-chip Dow average heading for a sixth straight day of gains. But they trimmed gains sharply and headed lower at 2:48 p.m. after traders heard about the exit poll speculation on the Internet. Shares of defense, pharmaceutical, health care and medical technology companies led the reversal. ``What we are hearing is that there is some feedback coming back from Ohio, that there could be a closer outcome out there or John Kerry could even potentially win that state,'' said Evan Olsen, head of equity trading at Stephens Inc. Lisa Hansen, head trader at Transamerica Investment Management, said, ``Apparently the blogs are saying that Kerry is ahead in one or two of the swing states and that's why the market dipped.'' Turnout was unusually high as Americans voted to decide whether the Republican incumbent Bush or the Democrat rival Kerry would be the next U.S. president. The S&P health care sector index, made up of companies that Wall Street believes would do well under a second Bush term, slid 1.5 percent in the 30 minutes after the Internet talk spread. The index closed off 0.09 percent. Among the biggest turnarounds was health insurer Humana Inc., which closed down 66 cents, or 3.24 percent, at $19.69. Big drug makers like Pfizer Inc. also are among stocks expected to get a boost from a Republican administration. Pfizer fell 10 cents, or 0.35 percent, to $28.70. Defense stocks also slipped on prospects of a Kerry victory, with the S&P aerospace and defense index off 1.28 percent. The biggest decliners included General Dynamics Corp., down $1.86, or 1.82 percent, at $100.48, and Lockheed Martin Corp., down $1.68, or 3.01 percent, at $54.11. General Dynamics was viewed as a Bush stock since it makes hardware like military vehicles and ships, while the president's focus on missile defense was seen helping shares of companies that make the equipment and technology. Some investors said a Kerry sell-off might be short-lived. ``Fundamentally, there is nothing to indicate that Kerry will be bad for the market,'' said Som Dasgupta, head of equities trading at PNC Corporate Bank. ``There are all kinds of statistics around (that) if the incumbent is a Republican and a Democrat wins, then the initial market sell-off is 1.5 percent. Then the market comes back up around 2.8 percent through January.'' Stocks had been helped earlier in the session by falling oil prices, as crude fell below $50 a barrel to the lowest settlement price in more than a month. The December crude futures contract settled at $49.62, down 51 cents, on the New York Mercantile Exchange. ``Breaking below $50 was huge,'' said Todd Clark, head of listed trading at Wells Fargo Securities. Just four days ago, crude was trading close to $56 per barrel. Energy-sensitive issues, including airlines, attracted buyers, with the American Stock Exchange airline index rising 3.76 percent to its highest point since mid-July. Continental Airlines shares rose 58 cents, or 6.07 percent, to $10.14, Northwest Airlines Corp. advanced 32 cents, or 3.47 percent, to $9.54, and JetBlue climbed $1.38, or 6.19 percent, to $23.69.http://www.nytimes.com/reuters/news/news-markets-stocks.html? ex=1100436018&ei=1&en=89d93b2f2dd13975
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- : Exit Poll Talk Hits the Stock Market David Farber (Nov 02)