Military

DATE=10-31-01

TYPE=CORRESPONDENT REPORT

TITLE=WALL ST. WRAP (S&L)

NUMBER=2-282520

BYLINE=ELAINE JOHANSON

DATELINE=NEW YORK

VOICED AT:

INTRO: U-S stock prices were mixed Wednesday, as new data showed the U-S economy shrank in the third quarter. V-O-A correspondent Elaine Johanson reports from New York:

TEXT: The Dow Jones Industrial Average dropped 46 points, half a percent, to nine-thousand-75. The broader Standard and Poor's 500 index was down just fractionally, while the tech-weighted Nasdaq composite finished on the up side, with a gain of over one percent.

Gross-Domestic-Product, which is the widest measure of the economy, came in with its first negative reading since 1993. G-D-P was down four-tenths of one percent in the third quarter. Analysts were expecting a sharper decline.

But if the economy shrinks this quarter, too, that is the generally accepted definition of a recession. And experts say right now the fourth quarter is not looking good.

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Analyst Gary Goodenough:

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Looks like the current quarter is extremely weak. Employment numbers are out on Friday. Looks like it could be down 400-thousand jobs. G-D-P looks like it might be negative two percent or so this quarter. It might even still be negative in the first quarter of next year.

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Meanwhile, U-S photography giant Eastman-Kodak pressured the Dow for the second straight day. Kodak shares dropped another seven percent. Sales of Kodak film have been declining sharply.

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Analyst Art Cashin says the market tries to rally. But he says investors generally are not buying with any kind of enthusiasm:

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There's really not a "bull" pressure here (aggressive buying). With all the rumors going on about geopolitical and heightened alerts and whatever, it's tough to see people going in to buy with both hands.

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U-S wireless company Motorola was a bright note for the technology sector. The company says it is selling more of its product, boosting its share of the global handset market about 18 percent in the third quarter.

Rival Nokia of Finland has attributed its slipping share of the market to what it called "panic pricing" by competitors.

And leading chip maker Intel, a Dow component and a major player in the Nasdaq market, gave a positive outlook for long-term growth. Intel said the billions of dollars it is spending this year would yield big profits when the recession in technology is over. (signed)

NEB/EJ/MAR