Stocks Down, But Off Lows
NEW YORK (AP) — Stock prices were modestly lower on Wall Street at midday Monday.
The Dow Jones industrial average is down 43 points at 11,908. Decliners on the New York Stock Exchange hold a 5 to 1 lead over advancers.
The Nasdaq Composite Index has lost 30 points at 2,181.
And the Standard-and Poor’s 500 Stock Index is down 15 points at 1,272.
Trading on the New York Stock Exchange during the first two hours totaled 1.9 billion shares. Volume on the Nasdaq Market came to 744 million shares.
Wall Street has seen calm Monday, as investors react to news that JPMorgan Chase & Co. is buying investment house Bear Stearns in a deal backed by the government. The Dow Jones industrials, down nearly 200 points in the early going, fluctuated in and out of positive territory.
Besides supporting the buyout, the Federal Reserve took the extraordinary step of lowering the rate it charges to loan directly to banks on Sunday night – ahead of its scheduled meeting Tuesday. The central bank lowered the discount rate by a quarter point to 3.25 percent.
And in another unusual move, the Fed said it set up a lending option for big investment banks to secure short-term loans.
Bear Stearns shares fell 86 percent to $4.20 – still above the buyout price.
Bond prices rose as stocks fell. The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 3.37 percent from 3.44 percent late Friday.
The dollar sank to a record low against the euro and hit a 12 1/2 year low against the yen, while gold prices surged to another record high.
Light, sweet crude dropped $1.89 to $108.33 per barrel on the New York Mercantile Exchange, after rising to nearly $112 a barrel in premarket trading.
