Stock market still

Published 12:00 am Sunday, July 21, 2002

sliding

From staff reports

After dropping more than 1,400 points since July 5, it does not take much of an expert to tell that a bear market is overrunning Wall Street. But the reason most experts are giving is a lack of consumer and investor confidence.

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"The mood is just horrible," said one market analyst. "Markets tend to go to extremes, and I am seeing a lot of good companies that are being completely annihilated without reason."

News of corruption and accounting fraud by some of the nation’s largest corporations has led to investor mistrust and recent stock sell offs.

Friday’s market action, capped off a dismal week on Wall Street, as the Dow Jones closed down more than 390 points to 8,019.26.

But some experts say the market is due for a comeback in the coming weeks, hinting at the fact that the market could only go up from here.

"Valuations matter, and they have been improving," Thomas McManus, strategist at Bank of America Securities, told Reuters. "Now we are starting to see bargains popping up, good companies available at prices you would not have considered possible in some time."

Friday’s loss by the Dow was the seventh-largest points decline in history and was spurred by Johnson & Johnson, which reported U.S. regulators are looking into allegations of fraudulent record keeping. The company’s stock fell 16 percent in Friday trading.

The Dow fell 9.4 percent in June, the worst month since a 10.5 percent drop in February. In July, the Dow has declined 13.2 percent.

The blue-chip Dow index closed at its lowest level since October 1998, finishing the week with a drop of 7.8 percent, pushing it back into bear territory. The Standard & Poor’s 500 ended the week down eight percent. The Nasdaq composite finished the week off four percent.

So far this year, the Dow is off 20 percent, the S&P has surrendered 26.2 percent and the Nasdaq has given up 32.4 percent.