Military

DATE=09/17/2001

TYPE=CORRESPONDENT REPORT

TITLE=WALL STREET MONDAY (L AND S) CQ

NUMBER=2-280668

BYLINE=ELAINE JOHANSON

DATELINE=NEW YORK

CONTENT:

VOICED AT:

///EDS: CORRECTS 2-280666 NASDAQ PERCENTAGE DROP IN GRAF 3 OF TEXT TO SEVEN.///

INTRO: There were signs of patriotism all over Wall Street Monday, but

no patriotism rally. U-S stock prices fell sharply on the first day of

trading since terrorists struck at the heart of the world's financial

center last Tuesday. V-O-A correspondent Elaine Johanson reports from

New York:

TEXT: Wall Street opened on a solemn note -- two minutes of silence and

a refrain of "God Bless America." Top state and city officials were at

the podium. So was the U-S Treasury Secretary -- all intended to boost

confidence.

But investors apparently were concerned about the consequences of the

terror attack on an already slowing U-S economy. Airline and insurance

stocks plunged. There was not much that was up Monday.

The Dow Jones Industrial Average fell almost 685 points, nearly seven

percent, to eight-thousand-920, its lowest level since late 1998. The

tech-weighted Nasdaq composite sank almost seven percent, while the

broader Standard and Poor's 500 index lost 53 points, just under five

percent.

Still, analysts say there was no sense of panic on Wall Street. That

was good news. Many believe it will take a while for the markets to

absorb the uncertainties.

///REST OPT///

The markets plunged despite confidence-building measures. The Federal

Reserve, the U-S central bank, announced a surprise interest rate cut,

the eighth this year. And rules were relaxed so corporations can buy

back their shares at any time of the day.

Hardwick Simmons, the chairman of the Nasdaq market, saw no reason for

alarm:

///SIMMONS ACT///

Right now it's just sit and watch. You've got some companies in there

with share buyback programs. They probably aren't going to buy now at

these levels. But if the markets get a little bit lower, they may well

come in. So right now you've got a lot of people sitting there watching

the market, and the market is performing admirably.

///END ACT///

James Riefe (pron: ree'fee), one of the leading mutual fund managers,

says he told his clients to stay calm and do very little until the

economic picture becomes more clear:

///RIEFE ACT///

We'll have to wait and see what's going to happen these next few weeks

and the real world settles in, and the parts of the economy that will

remain strong, and the parts of the economy that are going to suffer a

bit.

///END ACT///

Overall, analysts were pleased that the markets operated with no

technical problems after all that devastation in lower Manhattan.

Imagine the chaos, said one expert, if computer and power systems failed

in the course of trading. (signed)

NEB/NYC/EJ/RH