U.S. financial markets shut down after WTC attacks
AP Business Writer
NEW YORK (AP) -- Wall Street was shuttered for a second session Wednesday as New York's financial district struggled to recover from a terrorist attack that devastated the World Trade Center.
The New York Stock Exchange, American Stock Exchange and Nasdaq Stock Market were expected to decide later in the day when trading would resume. Securities and Exchange Commission Chairman Harvey Pitt said Wednesday would be a day for assessment, but believed the markets would be ready to open Thursday, according to SEC spokesman John Heine.
"The market is very reactive right now, and it's never seen anything like what just happened," said Brian Belski, fundamental market strategist at US Bancorp Piper Jaffray.
The shutdown on the NYSE, the nation's oldest exchange, was the longest since the market closed for two days at the end of World War II. The NYSE's longest closing was nearly four months during World War I.
The trade center is a few blocks from the NYSE in the area known as the Financial District, home to dozens of investment houses and brokerages. Its twin 110-story towers, among the tallest skyscrapers in the world and a distinctive part of the city's skyline, collapsed Tuesday after two hijacked jetliners crashed into them, scattering debris throughout the area.
The New York Mercantile Exchange, where energy futures are traded, is in the nearby World Financial Center, which was not directly hit in the plane assault.
Overseas, markets plunged Wednesday in continuing reaction to the terrorism in the United States.
In Asia, stock prices plummeted on fears the terrorist attacks in the United States could deal a severe blow to the ailing U.S. and Japanese economies. European markets, which sank late Tuesday after the attack, opened cautiously higher.
"Independently of how the United States replies to the terror attacks, political events generally count for only a limited time on the market," said Ulrich Ramm, chief economist at Germany's Commerzbank in Frankfurt.
Still, it was hard to assess how U.S. investors would react when trading started again.
"This attack was an overt attempt to disrupt the financial system. But a lot of how the U.S. market reacts will probably depend on how long it stays shut," said Richard Dickson, technical analyst at Hilliard Lyons. If the shutdown is brief, there might be some initial selling when trading resumed, Dickson said, but "things would stabilize pretty quickly."
Longer term, other economists worried that billions of dollars in lost business because of the attacks could further jeopardize companies already struggling and tip the fragile U.S. economy into recession. More than $100 billion worth of trades are conducted every day in the United States, according to the Securities Industry Association.
The Federal Reserve said it was ready to provide additional money to banks if needed, a step designed to reassure Americans that the nation's financial system was still working.
To most market watchers, financial concerns were secondary to thoughts about the thousands feared killed.
"I am broken up by this. I have a lot of friends up there," said Dickson, the Hilliard Lyons analyst. "I'm sort of sitting on the edge of my chair."