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Dow falls 159.93 as markets stumble worldwide; Dollar and bonds rally |
Thursday, June 11, 1998
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(06-11) 16:25 EDT NEW YORK (AP) -- Stocks tumbled Thursday on worries that Asia's financial worries will curb future company profits, while the dollar and U.S. Treasury bonds soared as investors sought a haven for their funds. The Dow Jones industrial average fell 159.93 in active trading, or by 1.8 percent, to close at 8,811.77. While still up 11.4 percent so far this year, more than analysts had expected, the Dow is off 400 points, or 4.3 percent, from the record 9,211.84 reached May 13. Broader market indicators also sagged following declines in markets in Asia and comments about the ailing Japanese economy by Treasury Secretary Robert Rubin. ``The Japanese economy still fails to show signs of recovery,'' Rubin told the Senate Finance Committee. ``And Japan's economic difficulties and weak currency are having substantial adverse impact on the East Asian countries.'' If Japan fails to rekindle growth, investors worry, the engine for recovery in Asia will be stalled. That means bleaker profit prospects for U.S. companies. The worries also sent the Japanese yen sinking to an eight-year low against the dollar. Treasury bonds gained as traders at home and abroad sought a dollar-denominated haven for their funds. Yields on 30-year Treasuries fell to 5.65 percent as U.S. stock markets closed, down from 5.70 percent late Wednesday. That is the lowest yield ever since the government began regular auctions of 30-year bonds in 1977. The previous low of 5.69 percent was reached Jan. 12.
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