Marketplace: News Archives

Wednesday, November 8, 2000
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It's Wednesday, November 8. I'm David Brancaccio.

And the President of the United States is… Bill Clinton. As for who will replace the man in January, that's not clear yet, pending a recount in Florida and the opening of some absentee ballots for that state coming in from overseas. We can report with certainty that the Dow Jones Industrial Average fell 45 points, and there was a landslide away from the Nasdaq Composite fell 184 points, 5.4 percent. Marketplace's New York editor Michelle Brier begins our coverage of how investors digested the election melodrama.

Brier: "It's never really quiet on the floor of the New York stock exchange, where the preferred method of doing business is shouting and frantic arm waving, but there was something rather subdued about the scene today. Maybe traders were exhausted after staying up much of the night to watch election results, but stock broker Alan Valdes says they're just hedging their bets."

Valdes: "I think everyone puts their positions on hold, just waiting to see what happens tomorrow. Hopefully it's decided tomorrow. I think whatever happens, the economy will go on as usual, but they want to wait and see what happens."

Brier: "Even though the Dow was flat or up just slightly most of the day, seasoned traders noted there seemed to be some indicators that investors were expecting the election cliffhanger to end with a George W. Bush victory. Ted Weissberg is president of seaport securities."

Weissberg: "There are those who feel the drug stocks are a good proxy for a Republican victory and they are extremely strong today. I might add, they've been strong for a week and a half."

Brier: "Tobacco's up as well, but Weissberg adds, its hard to say whether those companies are doing well because of something bottom line, like a profit outlook, or because they are forecasting a republican white house win."

But Michelle, the Nasdaq was down 5.4 percent, 184 points? Is that connected to or divorced from political events?

Brier: "You cant' completely separate the political scene from the markets - the markets hate uncertainty and that's what we've got here. But David, why do you sound so surprised? The Nasdaq's been dropping 100 points here and there almost every day, it's become a regular occurrence. One analyst I spoke to today put it this way: the Nasdaq is doing exactly what it's been doing, that is lose ground. There are earnings concerns, future growth concerns - it's all the usual stuff. It doesn't help that we've got this cliffhanger but it's not to blame."

Michelle, some specific companies on the Nasdaq?

Brier: "All the big names were down today. Sun Microsystems lost almost 9 percent, Dell down almost 6 percent, Intel down almost 8 percent and all of those companies have been under pressure for days."

Marketplace's Michelle Brier in New York.

One long-time markets observer, however, sees opportunity in the split electorate and split congress. William Seidman {SEED-min} was chairman of the Federal Deposit Insurance Corporation and oversaw the government's response to the Savings and Loan crisis.

Seidman: "I don't agree that it's gridlock, what it means is that the two parties will have to get together and decide what is best. That's essentially what we've had in the last six years and that hasn't been all bad. We got the free trade movement going, we balanced the budget, we kept our hands off the fed, we cut the capital gains taxes. I think, by our experience in the last six years, this may not be the disaster that some people are saying."

Financial and political observer William Seidman sorted out the Savings and Loan Crisis during the late 80's and early 90's.

And that's the top of our news for Wednesday. Today the Nasdaq fell to 3231, a drop of 5.4 percent. More details when we do the numbers.