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Market stays in a Pretzelby Lisa Singhania NEW YORK – The economic fallout from the terrorist attacks sent stocks plummeting for the second time in three days yesterday, with a late burst of buying, saving the Dow from its worst three-day point loss ever. The Dow Jones average was down as much as 423 points mid-afternoon but recovered somewhat and finished with a loss of 144 points following news reports that the Pentagon ordered warplanes to begin moving to the Persian Gulf area, the first concrete sign of preparations to retaliate. "I think that's what the market needed to see. They wanted to get rid of uncertainty and this helped," said Charles White, portfolio manager at Avatar Associates. Still, the market remained vulnerable after tens of thousands of job cuts at Boeing, American Airlines and other companies that have seen their business crippled by the terrorist attacks. At its low yesterday, the Dow had a three-day loss of more than 1,100 points. Its worst three-day loss was 984 points in August 1998. The Dow closed down 144.27, or 1.6 percent, at 8,759.13. So far this week, the Dow is down 746.81, or 8.8 percent. The NASDAQ was down 27.28 at 1,527.80, a 1.8 percent loss, while the Standard & Poor's 500 index was off 16.64, or 1.6 percent, at 1,016.10. Yesterday's trading showed how unpredictable the market is likely to be in upcoming days. It had appeared to steady Tuesday after the severe drop Monday, when the Dow fell a record 684 points. But Boeing's announcement late Tuesday of as many as 30,000 job cuts, as well as predictions of troubles ahead by Eastman Kodak and others, renewed investors' fears. Boeing fell 53 cents yesterday to $32.61. The attacks have taken a toll on the already weakened aviation industry, but airline stocks were mixed yesterday. The parent company of American Airlines said yesterday that it would lay off at least 20,000 employees, bringing the industry's job cuts to about 46,000 since the attacks. Meanwhile, lawmakers appeared ready to move as early as this week on relief legislation worth billions of dollars. American Airlines' parent, AMR, ended the regular trading session unchanged but rose $1.50 to $21.50 in late trading. Continental fell 26 cents to $17.46, while Delta gained 23 cents to $17.66. "It's very murky as to what our reaction is going to be politically, and meanwhile you're continuing to get major layoff announcements," said Bill Barker, investment consultant at Dain Rauscher. "The economic uncertainty has heightened considerably." Eastman Kodak slid $2.22 to $37.61 after it lowered third-quarter expectations and said more job cuts are inevitable. The world's largest photography company announced in April that it was cutting 3,500 jobs from a global payroll of 78,400. Technology stocks also took a hit. Intel fell $1.19 to $22.28. "I think market overall is bracing for higher unemployment," said Robert Streed, portfolio manager of Northern Select Equity Fund. Among the few winners yesterday was Telecommunications Company Verizon, which rose $2.20 to $53.90.
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