Stocks fall for fifth straight session

AP Business WriterNEW YORK (AP) -- Doubts about corporate bookkeeping and earnings thwarted Wall Street for a fifth consecutive session Thursday, giving the Nasdaq composite index its longest losing streak since the terrorist attacks.

Stocks drifted progressively lower throughout the day, unable to hold on to early gains. Analysts said the losses reflected investors' unwillingness to get involved in a market with so much uncertainty.

The Dow Jones industrials closed down 27.95, or 0.3 percent, at 9,625.44, according to preliminary calculations, for a total loss of 294 points in the five sessions including last Friday. The Dow fell six straight sessions in January.

Broader indicators also slumped, with the technology-focused Nasdaq falling 30.59, or 1.7 percent, to 1,782.12, its lowest close this year. The last time the Nasdaq closed down five sessions in a row was the week of Sept. 17, when the market reopened following the Sept. 11 attacks.

The Standard & Poor's 500 index dropped 3.34, or 0.3 percent, to 1,080.17.

"Investor sentiment has changed in the last two or three weeks from being cautiously optimistic to cautiously concerned," said Michael Strauss, managing director and senior economist at Commonfund. "While earnings are better than what was feared four months ago, the prospects that companies are indicating and even the prospects indicated by the economic numbers are still suggesting that it may be a couple of months or quarters before we return to solid growth."

Stocks have been falling since the beginning of the year, chiefly on doubts about how much the economy and business conditions are improving. Wall Street has also become increasingly dubious about the quality and accuracy of corporate earnings, particularly at companies that have complicated structures. With the Enron debacle making news every day, investors are more cautious about buying.

Cisco Systems tumbled $1.55, or 8.3 percent, to $17.06, despite reporting better-than-expected second-quarter results late Wednesday. Analysts said investors were concerned by its cautious forecast for the coming quarter and worried about the effect a less-than-robust turnaround would have on business.

Monthly retail sales reports provided little boost for the market, although some of the figures were relatively strong. The mixed data, while not surprising in a weak economy, gave investors another reason to worry about whether consumer spending, which accounts for two-thirds of the economy, will hold up.

Wal-Mart Stores slipped 49 cents to $58.39 despite reporting January sales well above Wall Street expectations. Federated Department Stores fell 92 cents to $38.32 after posting an 8.8 percent decline in sales at stores open at least a year.

"Obviously, there's been a real shaking of investor confidence, which was already fragile after two down years on the market, with regard to these accounting and regulatory issues," said Joseph Keating, chief investment officer at AmSouth Asset Management. "I think the economy is recovering ... but until this crisis of confidence passes, it's going to be very hard for the market to hold any gain."

There was some bargain hunting. Tyco, one of the companies whose accounting has attracted particular attention, continued to rebound from a sharp drop, rising $2.18, or 8.4 percent, to $28.10 after the company said it plans to answer analysts' questions weekly in a conference call to ease investors' concerns about its business practices.

Also Thursday, the Labor Department said new claims for state unemployment insurance dropped by 15,000 last week to a seasonally adjusted 376,000, the lowest reading in three weeks. The figure was slightly better than expected, but most economists expect the unemployment rate to continue to grow.

Declining issues led advancers more than 5 to 4 on the New York Stock Exchange, where volume came to 1.42 billion shares, down from 1.67 billion a day earlier.

The Russell 2000 index dropped 4.00 to 458.41.

Overseas, Japan's Nikkei stock average gained 1.7 percent. In Europe, Germany's DAX index advanced 1.2 percent, Britain's FT-SE 100 climbed 1.1 percent, and France's CAC-40 rose 0.5 percent.

------

On the Net:

New York Stock Exchange: http://www.nyse.com

Nasdaq Stock Market: http://www.nasdaq.com