Reuters North American News Service, October 25th, 2007
NEW YORK(Reuters) - U.S. stocks fell Thursday,
after disappointing quarterly results from companies such as
Comcast Corp and as investors worried financial
services companies would report more big losses from the
credit crisis.
American International Group Inc was the top drag
on the Dow after market rumors the insurer may be facing a
large write-down. But AIG's stock retraced most of its losses,
after CNBC reported, citing sources, that the rumors were
"simply not true."
AIG shares slid more than 8 percent, the biggest drop in
2-1/2 years, before retracing almost three-quarters of those
losses.
A company spokesman declined to comment.
The rumors came a day after Merrill Lynch
announced write-downs of $7.9 billion stemming from losses on
mortgage-backed debt and related securities.
"Concerns over subprime issues are continuing to bang
around out there, and you've seen earnings which have been
coming in mixed, so that is weighing on investor sentiment,"
said Kurt Brunner, portfolio manager at the Swarthmore Group,
in Philadelphia, Pennsylvania.
"There were rumors AIG may take a big write-down. Given
what Merrill said yesterday about the size of the write-down,
people are nervous and you are going to have these rumors.
Investors who own these stocks will be thinking: 'If the train
is going to come, shall i step out in front of it, or shall I
get out of the way now, just in case?"'
The Dow Jones industrial average was down 39.02
points, or 0.29 percent, at 13,636.23. The Standard & Poor's
500 Index was down 2.61 points, or 0.17 percent, at
1,513.27. The Nasdaq Composite Index was down 23.16
points, or 0.83 percent, at 2,751.60.
AIG stock was down 2.5 percent at $62.27, after earlier
falling as low as $58.46.
Merrill's stock lost 3.9 percent to $60.74.
Comcast Corp, the largest U.S. cable TV operator, posted a
54 percent drop in quarterly net profit. Comcast also lost
more basic video subscribers than analysts had expected.
Shares of Comcast slid 11.2 percent to $21.18.
