Blue Chips Plummet 235.23 Points --- Interest Rates, Economy Cited
Uncertainty about interest rates and economic growth, ahead of a long holiday weekend, pushed stocks to some of their sharpest declines this year.</br></br>The Dow Jones Industrial Average fell 235.23, or 2.20%, to 10466.93, the year's heaviest drop in point terms and thirdheaviest in percentage terms. Leading the way down were the old-style manufacturing stocks that had soared in April, as well as the banking stocks.</br></br>Even considering that point moves in the industrial average aren't as significant, in percentage terms, as when the index was at lower levels in past years, this has been a volatile week. There have been three drops of more than 100 points, including yesterday, and one gain (Wednesday's 171.07-point rally).</br></br>Some investors were locking in profits yesterday by selling winners ahead of what is expected to be quiet pre-MemorialDay trading today. International Business Machines, which had soared on Wednesday in advance of a stock split, declined. But Nasdaq-listed semiconductor stocks such as Intel posted gains, and the technology-heavy Nasdaq Composite Index fell just 8.03, or 0.33%, to 2419.15. News that the Nasdaq Stock Market plans to extend trading into the evening hours helped buoy that index.</br></br>Investors continued to worry about last week's announcement from the Federal Reserve that it is leaning toward raising interest rates. A variety of analysts warned that a Fed move could come as soon as its next meeting, scheduled for June 29 and 30. Bonds fell on those concerns and on reports that foreign central banks were selling U.S. bonds. The bellwether 30-year Treasury bond declined 20/32, or $6.25 for every $1,000 in bond face value. That pushed the yield, which moves inversely to bond prices, up to 5.842%.