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America's New War: Futures Stocks Down

Aired September 21, 2001 - 06:49   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
CAROL LIN, CNN ANCHOR: Amanda Lang is at the New York Stock Exchange this morning for a preview of today's trading -- Amanda, the futures don't look so good right now.

AMANDA LANG, CNN CORRESPONDENT: They really don't.

We've got a lot of negativity priced into these futures as we head toward that opening bell. Futures have stopped trading at 915 at the moment. The combination factors: Bush's address, which leads to increased uncertainty about possibly America at war, and of course, the overseas markets not helping one bit. Europe is very weak at this hour, and that is hurting the futures markets here -- Carol.

LIN: Do you see anything more specific behind the dive of these markets?

LANG: There are a couple of factors out there that are being isolated. Yesterday, of course, the Dow losing 382 points. Among the issues, there is a concern that some investors may be pulling their money out of equities, out of their mutual funds, and margin calls. There's a technical issue on Wall Street that a lot of people out there, some big investors, have bought stock on borrowed money, and the people they borrowed it from call it in. And that can put real pressure on the market; Disney stock hit by that very factor yesterday.

LIN: Yes, we certainly saw that. Well, anything today that you think might move the markets in either direction?

LANG: Well, unfortunately today there is some increased issues out there that will create volatility. Triple witching -- again, it's a market technical. There's some expiration of options. It happens on a Friday. It's a typical event, but it's likely to have a negative impact. There's a Friday effect. People don't like to go home for the weekend in this kind of uncertainty holding stocks that are in any way giving them some grief. So we may see some selling just for that reason.

And, you know, profit warnings continue. It's the season for it anyway, and we're still hearing from corporate America about how all of these events are hurting their bottom line, and that is taking its toll on stocks as well.

LIN: Well, are there any sectors out there that are holding up, then?

LANG: Well, there are a couple of bright spots. Watch gold and silver. They are natural hedges -- investors moving into them in these times of uncertainty. We're also watching some of the utilities and natural gas. They seem to be holding up.

There were a couple of bright spots even on the Dow. Among the Dow 30 yesterday: Proctor & Gamble, SBC, some of the natural defensive stocks still getting some buying. You know, in times like this that is a very good sign that there are still people out there that are looking for stocks to own -- Carol.

LIN: All right. Thank you very much, Amanda Lang, with an update and a preview on today's trading day. Yes, looking pretty volatile out there.

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