|The stock markets were all kinds of jittery today as traders grew nervous about September 9th, the first key Y2K test, and then interest rate fears.
Federal Reserve Chairman Alan Greenspan made a speech at an event honoring President Gerald Ford's inauguration 25 years ago in which no mention whatsoever was made about interest rates or other monetary tightening issues. Mr. Greenspan instead focused on the role that technology has played in increasing productivity. Increased productivity is a big factor in current economic growth. Trading during the late morning hours had gone up once Mr. Greenspan's comments hit the market and fears of interest rates hikes receded.
However, another speech by a Federal Reserve board member dampened the mood almost immediately. Federal Reserve Governor Laurence Meyer, in a speech to the National Association for Business Economics, made a speech in which he emphasized the need to pay down the national debt, a stance normally considered to be hawkish. According to a report from Reuters:
"Everyone was watching the wrong member of the Federal Reserve," said Dick Stein, a vice president and chief technical analyst at Noble International Investments of Boca Raton, Fla. "Meyer sounded as hawkish as you could possibly be."
In a speech to the National Association for Business Economics, Meyer said the tight U.S. labor market threatened to fuel inflation.
"He's been saying that since before he became a Fed governor," William Cheney, chief economist for John Hancock Funds, said before the market turned on the news.
The result is that Apple traded down throughout the afternoon. Apple closed at 74 1/2, a loss of 1 7/8 or 2.45%. Volume continued to be high today with 6,802,500 shares trading hands.
Most of the tech sector followed suit including almost all of Apple's PC competitors. IBM, Intel, Microsoft, Dell, Gateway 2000, and Compaq all closed down. Hewlett-Packard closed higher.
The Dow managed a last minute rally to close at 11036.34, a slight gain of 2.21. The Nasdaq closed at 2808.74, a loss of 28.52.