Katrina's Costs Weigh Down Stock Indexes
STOCKS SLOSHED AROUND in the red as investors focused more on post- Katrina worries than positive economic data collected prior to the devastating hurricane and its aftermath.</br></br>Stock indexes started the day up about 3% since the hurricane slammed the Gulf Coast at the end of last month. But rising damage estimates are stoking fears that the economy and corporate profits will be dinged by higher gas prices and lower consumer spending resulting from Katrina.</br></br>The Dow Jones Industrial Average fell 85.50 points, or 0.8%, to 10597.44. The tech-stock-heavy Nasdaq Composite Index slipped 0.5%, or 11.08 points, to 2171.75. The Standard & Poor's 500-stock index dropped 0.8%, or 9.36 points, to 1231.20. Bond prices rose as investors were cheered by lower-than-expected inflation in August, pushing down yields.</br></br>"The market has been pretty strong since the storm, so it makes sense that we'd give some gains back," said Andy Brooks, head of stock trading for T. Rowe Price Group Inc. "All this economic data is open to revision post-Katrina."</br></br>Indeed, investors shrugged off heartening readings on the economy gathered prior to the hurricane. Despite record oil imports, the U.S. trade deficit unexpectedly narrowed in July, the Commerce Department said. Meantime, the Labor Department released data showing that the prices of wholesale goods in the U.S. rose at a slower rate last month.