A new case of anthrax discovered in New York City shook the U.S. stock markets Friday, precipitating a steep sell off, but stocks regained some lost ground in the final hour of trading.
The Dow Jones Industrial Average closed 66 points lower, less than one percent, at 9,344. The broader Standard & Poor's 500 Index dropped six points to 1,092, while the tech-weighted Nasdaq Composite Index managed a fractional gain of about two points, ending the week at 1,703.
The market was under selling pressure even before the anthrax news, partly due to a dismal report from the retail sector. Sales plunged almost two and a half percent in September, a steeper decline than anticipated, raising concern that consumers might not return to the shopping malls as fast as many had hoped.
Meanwhile, negative news keeps coming out of corporate America. Leading copier company Xerox warned of a steep profit loss in the third quarter, about double earlier estimates. It blamed the shortfall partly on damages sustained in last month's terrorist attacks.
But the market still ended the week higher overall. The Dow Industrials edged up 2.5 percent. The Nasdaq gained six percent.
Veteran market-watcher Ted Weisberg said it is a positive sign the markets have been able to overcome the high level of anxiety and uncertainty among investors. But he said there is still a lot of cash on the sidelines and it could stay there for a while. "I think the fact that we've gotten the market back to where it is, is a big surprise for a lot of people," he said. "And the problem we have going forward is there are so many unknowns out there, both internationally and domestically which are not economic in nature, that it is good reason for people to pause and stay on the sidelines."
One of the "unknowns" Americans are dealing with these days is the anthrax scare. Only a few cases have been reported. But analysts say it compounds the fear people still have in the wake of the events of September 11.
Corporate security consultant Elaine Carey is telling U.S. companies to stay alert and give employees more support. "Communicate regularly with your employees. Communicate to them you have a crisis management plan and an evacuation plan," she said. "And two, give them some general security awareness. Tell everybody what is suspicious, what is not suspicious, what should you act on and empower them to speak up and have a way to get to somebody at the top in a hurry if they see something."
One thing for sure, amid all the uncertainty since September 11, is that it is hardly business as usual for corporate America.