Stocks fell to fresh session lows in early afternoon trading on Friday after a report that Atlanta's Hartsfield International Airport was shut after a man ran from a security checkpoint after being spotted with a gun.
"I heard that supposedly the Atlanta airport was evacuated ... That's probably what it is ... It seemed to coincide with that [pullback]," said Brian Pears, head of equity trading at Victory Capital Management.
The report came from a local Atlanta radio station, which said all flights were temporarily suspended and passengers were evacuated from the airport while security officials searched for the man.
"Beyond that, it was a fairly decent week again, at least in the early part, and now we have a little bit of profit-taking," Pears said.
Earlier stocks were down but off lows in listless trade amid some support from news of more progress in the US-led campaign against the hard-line Islamic Taliban in Afghanistan.
Still, weighing on the market somewhat were new statistics showing US industrial output last month took its biggest dive in nearly 11 years and extended a string of monthly declines that was the longest since the Great Depression of the 1930s, the Federal Reserve said on Friday.
The blue-chip Dow Jones industrial average fell 47 points, or 0.48 percent, at 9,824. The broader Standard & Poor's 500 Index was down 9.13 points, or 0.80 percent, at 1,133.11. The technology-laced NASDAQ Composite Index was off 12.94 points, or 0.68 percent, at 1,887.63.
High-tech giant Dell Computer Corp was in focus and lost more than 4 percent after the No. 1 maker of personal computers said late on Thursday its quarterly net income fell 36 percent as it waged a price war amid dismal corporate demand. It beat analysts' earnings forecasts, but offered what some consider a mixed outlook for the future.
The stock fell US$1.11 to US$26.58. Other computer makers also fell, including Gateway Inc, down US$0.30 at US$8.11, or 3.57 percent.
Xerox Corp, embroiled in a probe by federal regulators and allegations of accounting irregularities, slumped sharply after The Wall Street Journal reported on Friday it has reassigned its longtime controller and appointed a new accounting chief. The shares fell US$0.51 to US$6.58, or 7.19 percent.
Financial services companies American Express and Citigroup took a hit after downgrades by Wall Street analysts. American Express fell US$1.22 to US$33.17 after UBS Warburg cut its rating on the company's stock. Citigroup fell US$1.67 to US$48.42 after a downgrade by Prudential.
Raising hopes that the war would end soon, stocks cut losses briefly after the Pakistan-based Afghan Islamic Press news agency said the Taliban have decided to withdraw from their southern stronghold of Kandahar and head for Afghanistan's mountains.
Shortly after the open, stocks briefly trimmed their losses after a US official said US special forces killed one of the leaders of Osama bin Laden's Al Qaeda network.
The US and its allies are hotly pursuing bin Laden as the key suspect in the Sept. 11 attacks on New York and Washington.
"That's a positive for the market, but we've already built in a lot of good news," said Keith Janecek, a trader for Legg Mason Wood Walker Inc.
"We've been seeing progress being made, we know the Taliban is on the run, and the war is going to end here rather quickly."
Airline stocks were among the day's big gainers, bolstered by lower oil prices and passage of the aviation security bill. US Airways jumped US$0.99 to US$6.69, or 17 percent.
Yahoo Inc rose after it reiterated its outlook for the fourth quarter and said it expects next year's revenue to increase. Morgan Stanley analyst Mary Meeker added to Yahoo's upbeat tone on Friday, saying she is more confident of a turnaround at the company. Yahoo's shares jumped US$0.62 to US$15.45.
Starbucks Corp fell more than 9.6 percent after it said its quarterly profit rose 22 percent, meeting Wall Street's expectations. But Starbucks gave a less aggressive forecast than it previously had, reflecting growing concern about the US economy. The stock dropped US$1.83 to US$17.34.
Communications testing equipment and microchip maker Agilent Technologies said it will eliminate 4,000 jobs, doubling previously announced cuts, and pushed back hopes for a business recovery for half a year or more. The shares sagged US$1.14 to US$23.89.
Amazon.com shares, which have lost more than two-thirds of their value in the past year, fell US$0.10 to US$8.95. The company has Web sites geared toward customers in the US, UK, France, Germany and Japan.
Amazon.com Inc marketing and merchandising chief David Risher will leave the Internet retailer in March, the first departure of a senior executive in more than a year, as the company reorganizes into five divisions.
The company will merge its US and international operations and divide them into groups overseeing application software, retailing and marketing, services and business development, operations and customer service, and platform software and architecture, spokesman Bill Curry said.
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