SUSIE GHARIB: An emotional and historic day on Wall Street. The world watched as US stocks resumed trading after the longest interruption since the great depression. Stocks plummeted as expected from the opening bell, despite an early morning interest rate cut by the Federal Reserve. The Dow ended down almost 700 points, trading below 9000 for the first time in two and a half years. The NASDAQ also plunged, losing 115 points. We have two reports this evening, looking at the day on Wall Street and the impact of those Fed rate cuts. We begin with Scott Gurvey here at the New York Stock Exchange.

SCOTT GURVEY, NIGHTLY BUSINESS REPORT CORRESPONDENT: At 9:30 the New York Stock Exchange opened for business. On any other day the next line would be, so what. But this is not any other day. This is the sixth day after, after the day New York's financial district was decimated in an attack unlike any seen in the nation's history. The session actually began with two minutes of silence, silence in honor of the thousands of dead and missing in the tragedy. But while representatives of New York's uniformed emergency services rang the opening bell, assembled exchange, state, local and national officials made it clear that the perpetrators had not won.

RICHARD GRASSO, CHMN & CEO, NEW YORK STOCK EXCHANGE: We have served notice to the criminals that they've failed. America's economic system is intact. Our nation is strong and unified. Our economy is going to lead the global economy of the 21st century. And the equity markets in this country are up and functioning.

GURVEY: That is the message everyone wanted to get across. The reason so many people worked for so many days to get the markets open. In spite of the dramatic decline in the market averages, with volume exceeding 1 billion shares by noon, all the market participants expressed confidence that they will rebound as the city and the nation fight to rebound in so many ways.

MAYOR RUDOLPH GIULIANI, NEW YORK CITY: Reality is that we have to convey a two-fold complex message. I think we're going to be in a state of high alert for a long time, as our government determines what is necessary to do about this, how to defend us and how to make certain that democracy prevails over terrorism. And secondly, I think our society has to return to normal as much as possible. So that's a difficult balance.

GURVEY: In the days ahead there will be a multitude of stories written about this place and the efforts made to get it operational again, about the ring of soldiers guarding the building, about the trenches like open wounds dug in the street by workers from the telephone company and the power company who restored service, about the logistics nightmare getting people to and from work with the transportation system still crippled. About the smell of burning, which is everywhere, and the memories which are everywhere too. But for today the headline is, the stock market is open. And that is news enough. Scott Gurvey, "NIGHTLY BUSINESS REPORT" at the New York Stock Exchange.

Nightly Business Report transcripts are available on-line post broadcast. The program is transcribed by eMediaMillWorks. Updates may be posted at a later date. The views of our guests and commentators are their own and do not necessarily represent the views of Community Television Foundation of South Florida, Inc. Nightly Business Report, or WPBT. Information presented on Nightly Business Report is not and should not be considered as investment advice. © 2001 Community Television Foundation of South Florida, Inc.

09/17/01: Steps To Steady The Market

DARREN GERSH, NIGHTLY BUSINESS REPORT CORRESPONDENT: This is Darren Gersh at the Federal Reserve in Washington, where this morning's rate cut sent a powerful signal of support to the nation's financial markets. It came one hour before US stock markets reopened, a half a percentage point cut in the Fed funds rate, bringing the Fed's key short-term lending rate to 3 percent, its lowest level since 1992. In a statement, the Fed explained the cut saying, "even before the tragic events of last week, employment, production, and business spending remained weak, and last week's events have the potential to damp spending further." Hours later, markets watched as the European central bank, the bank of Canada and the Swiss national bank followed the Fed's lead, lowering rates half a percentage point-a coordinated message of collective resolve.

STEVEN EAST, CHIEF ECONOMIST, FRIEDMAN, BILLINGS RAMSEY: The central banks all around the world and policy makers in general, have signaled that governments are going to do whatever it takes to make sure that the wheels stay on the cart, that this is just going to be a temporary blip in the history of financial markets.

GERSH: Former Fed Governor Susan Phillips says there were signs before the attack that inventories had stabilized, and the economy had hit bottom, which is why Phillips says the Fed's statement today stressed that long-term economic prospects remain favorable.

SUSAN PHILLIPS, DEAN, GW SCHOOL OF BUSINESS: The US economy is still, I think, fundamentally sound, and in fact ready to make a rebound, and that was what I think the Fed was trying to signal.

GERSH: Since January, the Fed has now cut short term interest rates three and a half percentage points, and many analysts predict there will be more cuts at the Fed's meetings in October and November, and into next year.

ALICE RIVLIN, FORMER FED VICE CHAIR: It would not surprise me given where we are, if the Fed went down to 2 percent. I doubt that it will be necessary. I think they will probably go in smaller steps from now on.

GERSH: The Fed is clearly determined to keep the financial system afloat, promising today to keep injecting money into the banking system until markets return to normal. Darren Gersh, "NIGHTLY BUSINESS REPORT," Washington.

Nightly Business Report transcripts are available on-line post broadcast. The program is transcribed by eMediaMillWorks. Updates may be posted at a later date. The views of our guests and commentators are their own and do not necessarily represent the views of Community Television Foundation of South Florida, Inc. Nightly Business Report, or WPBT. Information presented on Nightly Business Report is not and should not be considered as investment advice. © 2001 Community Television Foundation of South Florida, Inc.

09/17/01: The Airline Industry Braces For Turbulent Times

SUSIE GHARIB: Airline stocks were among the hardest hit sectors in today's trading. And then late today the airline industry asked the Federal government for $24 billion in financial aid to help keep it flying. But as Quinn O'Toole reports, the turbulence ahead - there is much turbulence ahead for the carriers and their customers.

QUINN O'TOOLE, NIGHTLY BUSINESS REPORT CORRESPONDENT: At the end of the day, the losses to the airline industry were staggering and they were spread across the board. Among the majors, AMR, parent of American Airlines was down 39 percent. UAL, parent of United, down 43 percent. Delta (DAL) lost 45 percent and U.S. Airways (U) down 52. Airlines are now taking steps to scale back their operations and trim expenses. Today, US Airways announced it will cut capacity by 23 percent and eliminate 11,000 jobs. Over the weekend, American, Continental (CAL), Delta, and United announced similar service cuts, but industry analyst Darryl Jenkins says the moves are unlikely to be enough. He says as many as eight carriers could file for bankruptcy protection by the end of the year.

DARRYL JENKINS, AIRLINE ANALYST, THE GEORGE WASHINGTON UNIV. It's very unlikely that travelers are going to get on planes either this week or anytime in the near future. It could be one quarter. It could be two quarters down the road before people start flying. And then, after that, it could be another half-year where they start flying up to the levels where they're even at a break-even point.

O'TOOLE: With airlines stocks down 40, even 50 percent today, some investors may be tempted to buy, but analysts say given the enormity of last week's events, that would be a mistake.

JOHN LINEHAN, AIRLINE ANALYST, T. ROWE PRICE: Right now, we know very little about what is going to happen from here. It's very difficult to analyze an income statement or a balance sheet because we have no idea what passenger demand is going to look like going forward.

O'TOOLE: Late today President Bush ordered the government to develop a comprehensive assistance program for the airline industry and executives are scheduled to meet with administration officials tomorrow. Quinn O'Toole, "NIGHTLY BUSINESS REPORT", Washington.

Nightly Business Report transcripts are available on-line post broadcast. The program is transcribed by eMediaMillWorks. Updates may be posted at a later date. The views of our guests and commentators are their own and do not necessarily represent the views of Community Television Foundation of South Florida, Inc. Nightly Business Report, or WPBT. Information presented on Nightly Business Report is not and should not be considered as investment advice. © 2001 Community Television Foundation of South Florida, Inc.

09/17/01: One On One With John Manley, Sr. Equity Strategist, Salomon Smith Barney

PAUL KANGAS: Even though Wall Street was back in business, it wasn't business as usual for many firms. That includes Salomon Smith Barney. Senior equity strategist John Manley sat down with Suzanne Pratt at the NASDAQ market site to talk about today's markets and his outlook.

SUZANNE PRATT, NIGHTLY BUSINESS REPORT CORRESPONDENT: Everyone was expecting a selloff today, there's no question. But are you surprised by the severity of the selloff?

JOHN MANLEY, SR. EQUITY STRATEGIST, SALOMON SMITH BARNEY: No. I'm not. If you think about today is a situation where there seems to be no immediate reason to buy stocks and that's being priced in very quickly.

PRATT: But is this a knee jerk reaction to the tragedy that we had last week or is this a reaction to real concerns about the economy?

MANLEY: The real concern is about the economy. There are real concerns about the political situation. The market prices these in very quickly. The world is not as good a place as it appeared to be a week ago. The market has to factor that in.

PRATT: What is the mood like today? What are you hearing from clients? What are people telling you that they feel about buying stocks?

MANLEY: I think people are pretty good about it. One of the things I've heard is there are very few mutual fund reductions. It's been very light. People expected more. Secondly I think there's a sense of not wanting to sell, for noneconomic reasons not wanting to sell. And third I think there is some suspicion that at some point in time this is a buying opportunity and that probably that point is not too far away. So people are looking for reasons to buy, I must say.

PRATT: What about your outlook going forward? I mean do you expect that we're going to see this for several weeks or should we look for a turn around soon?

MANLEY: I think it depends on how quick the response comes. Historically it's after the response that the market begins to do well. Most of the damage was done very quickly, but if you look at Korea, you look at Pearl Harbor, you look at Kuwait, in all cases the market discounted most of the damage very soon, sort of bounced around for a while and then took off once the response was clearly on the table. Now, do you wait for that or not? I'll tell you over the last 50 or 60, 75 years those who bought or looked for reasons to buy during that difficult period did far better on a six to 12 month basis.

PRATT: We have a lot of positives, potential positives today. The Fed cut interest rates by half a point. We had news of stock buybacks from several companies. And we had all this talk about patriotism. Why wasn't, why weren't those things a bigger help to the market?

MANLEY: We don't know how big a help they were. We don't know how much the market would have opened down without them. The Fed I think just provides liquidity. I think they're there to make sure that the system doesn't rupture and I think they will do that very much, very well. I think you'll also have to expect some help from the Congress and the president. You get fiscal help there. These things take a while; the market has to adjust. This is in a strange way, I'd almost like to see it be over quicker. One of our portfolio managers suggested this is sort of a cathartic event that follows what's been going on for some time.

PRATT: So are you looking for some sort of capitulation that we haven't seen yet?

MANLEY: I think we're pretty close to it. I wish I could say that I had the ability to call the market on a day to day basis. I don't. No one does. But I think we're far closer to the bottom than not and I'm looking for reasons to buy, not reasons to sell.

PRATT: OK, speaking of reasons to buy, now clearly not that many people were interested in buying today, but ultimately we hope that people will be interested in coming back into the market. Are there sectors that look good to you?

MANLEY: Well, I think the visible sectors probably do well over the short term. Health care has a good story behind them. They're cheap on a P/E basis. That probably does OK. Oil, energy people will be concerned about this rightly or wrongly, I think they'll be concerned about it. Longer term, though, I still want to play the economy. I want to look for reasons to buy economically sensitive stocks, because I think we will have some economic weakness. It will be more explainable than it was before and ultimately we come out of it.

PRATT: One last question. Is there a wild card for investors still?

MANLEY: We never know what's going to happen. One of the problems about Tuesday, it opened up any possibility. I again, I think that's working itself into the market today.

PRATT: OK. Thank you, John.

MANLEY: Thank you.

PRATT: We've been speaking with John Manley of Salomon Smith Barney.

Nightly Business Report transcripts are available on-line post broadcast. The program is transcribed by eMediaMillWorks. Updates may be posted at a later date. The views of our guests and commentators are their own and do not necessarily represent the views of Community Television Foundation of South Florida, Inc. Nightly Business Report, or WPBT. Information presented on Nightly Business Report is not and should not be considered as investment advice. © 2001 Community Television Foundation of South Florida, Inc.

09/17/01: Investors Are Still Running With The Bulls

SUSIE GHARIB: Despite the tremendous selling seen today, individual investors appear to be taking it in stride. Jeff Yastine has a sampling of reaction from around the country.

JEFF YASTINE, NIGHTLY BUSINESS REPORT CORRESPONDENT: It was a busy day at brokerage firms around the country. In the retirement community of Hallandale, Florida, longtime investors have seen a lot of ups and downs over the years. But it was hard finding anyone here who was not bullish, despite the market sell-off.

LEE BERGER, INVESTOR: I know what we paid for our stock, and I see what the prices are now. I say, buy more, dollar average. The economy has to go up. America is strong. We will come back.

TED KAREGIANES, INVESTOR: I think today is a buyer's market. Anybody who sells today, they'll be regretting it three to four, six months from now.

YASTINE: In Chicago, much the same reaction. Selling, but no panic, with many more interested in finding something to buy in the weeks ahead, before worrying about what to sell.

JOHN CRESWELL, INVESTOR: I mean, the old adage long-term investing always works, so if I need the money tomorrow, I'll definitely pull it out, but if you don't need it for 10 years, the market's going to go up and down, and it's probably a good time to be investing.

STUART ITZKOWITZ, RESIDENT BRANCH MGR., SHOCHET SECURITIES: It's been hectic, no question about it, but it's very orderly. The clients who have been calling us, who are looking more for buys, stocks that are down that will bounce back. So I don't see any panic selling right now.

YASTINE: Strategists say the market's closure last week was helpful because it gave regular investors time to think. That didn't stop the sell-off, but it may have kept it more orderly than many expected. Jeff Yastine, "NIGHTLY BUSINESS REPORT," Miami.

Nightly Business Report transcripts are available on-line post broadcast. The program is transcribed by eMediaMillWorks. Updates may be posted at a later date. The views of our guests and commentators are their own and do not necessarily represent the views of Community Television Foundation of South Florida, Inc. Nightly Business Report, or WPBT. Information presented on Nightly Business Report is not and should not be considered as investment advice. © 2001 Community Television Foundation of South Florida, Inc.

09/17/01: Paul Kangas' Wall Street Wrap Up

PAUL KANGAS: As stock trading opened on Wall Street, those rate cuts weren't enough to stop an avalanche of selling pent up over this past week, reflecting great concern that the attack on America would trigger a global recession. The Dow Industrial Average went into free fall and posted a 630 point or 6.5 percent loss, about 45 minutes of trading. Into the session on the NASDAQ Index, was down 107 points or 6.3 percent, after an early rebound attempt in NASDAQ market failed. The big losers in the early sell off were the airlines, the insurance stocks and the lodging and leisure sectors, including Disney (DIS) and most of the cruise ship companies. Helping the market make a partial comeback however, were the defense stocks and those associated with security at airports, buildings, et cetera. At noontime, the Dow managed to trim its deficit to 476 points or 5 percent. NASDAQ Index was, cut its loss to 73 points or 4.4 percent. That attempt to gain a foothold on the road to recovery gave way to a new wave of selling in afternoon trading which sent the Dow to over a 720-point loss at 3:00 p.m. Late in the session, however, enough buying appeared to cut that closing loss in the Dow to 684.81 points or 7.1 percent, putting it at 8920.70. That's nearly a three-year low. The NASDAQ Composite had a bad day as well, falling 115.82 points or 6.8 percent and now stands at 1579.55.

Big board volume an absolute record, 2.36 billion shares. Now stock prices may have been down today, but the record volume indicates the marketplace was up and functioning very well as Chairman Dick Grasso indicated. The down volume was about six times up volume.

The Dow Transport Index off nearly 405 points or over 15 percent, terrible loss there.

Utility Index down just over 7 1/4 points.

Closing Tick still bearish at -662.

Standard & Poor's 500 off 53 3/4 points.

Nearly a 30 point drop in the 100.

The MidCap 400 off almost 22 1/2 points.

Bridge Futures Price Index edged up .04.

A loss of just over 26 points in the New York Composite.

Value Line off 21 2/3.

A loss of just over 23 points in the Russell Small Cap.

And the Wilshire 5000 down 513 3/4 points exactly, 5.1 percent.

The bond market, in its third trading session since last Tuesday's attack on America, felt the sting of some profit taking today after moving nicely higher last week. Because the stock market's steep downturn was expected, bonds did not benefit so much from flight to safety buying as they did last week and the 0.5 percent cut in the Fed funds rate came as no great surprise, either. As a result, tax-free and corporates closed won 1/4 to 1/2 point on average, and Treasuries fell across the board.

The 5-year notes down 10/32.

The 10-year notes off 16/32.

And then the 30-year bond off 30/32.

And finally, if we have the Lehman Brothers, we don't have the Lehman Index today.

Well, it was the biggest point loss in Dow history, 7.1 percent, but not the biggest percentage loss by any mean. That was October '87 when it was down 22.6 percent. No fight between declines and advances, about four times on the declining kind, only 82 new yearly highs, 541 new yearly lows.

General Electric (GE) topped the active list on 55.8 million shares, down $4.20 or 10.7 percent. Company says losses at its reinsurance unit could hurt third quarter earnings by $0.04.

Disney (DIS) down $4.33. Standard & Poor's downgraded it from "accumulate" to "avoid."

EMC (EMC) down only $0.20.

There AOL Time Warner Inc. (AOL) fell $4.41.

Cendant (CD) off $3.36. There's some concern that its deal to acquire to Galileo might be in jeopardy. Galileo stock fell $8.20.

American Express (AXP) off $4.76. Standard & Poor's downgraded it from "accumulate" to "hold." AG Edwards said sell.

Citigroup down $2.85. Company sees insurance losses of about $500 million. That could hurt earnings by $0.10.

Compaq (CPQ) fell $1.60.

Southwest Airlines (LUV) in that weak group, off $4.12.

And Pfizer (PFE), even though it bought some of its own stock today, down $0.03.

American International Group (AIG), one of the insurance companies, hurt badly, down $3.26. Although it was as low as 67 today, but then the company said it's going to buy back 40 million of its shares.

Delta Airlines (DAL) down nearly 45 percent, the worst of the major carriers' performance today.

Nokia Corporation (NOK) bucked the trend, up $1.69 after the company said it expects to meet third quarter earnings estimates, despite a drop in revenue.

Phillip Morris (MO) up $1.33. Big consumer stocks like this are in demand as safe havens.

And Raytheon (RTN) up 665. Defense contractor Standard & Poor's upgraded it from "accumulate" to "strong buy."

But United Tech (UTX) down $18.70, concern that disruption in the airline industry could hurt its jet engine business. Company also issued a fourth quarter earnings warning. Armor Holdings (AH) the star of the day, up $5.62. Company provides security risk management services to corporations and "BusinessWeek" reported that market letter writer, Charles Lalogia thinks Tyco TYC) or Securitas, a Swedish firm, might make buy out bids.

L3 Communications (LLL) up $24, specializes in communications, especially for defense.

American Water Works (AWK) up $6.51. It's going to be acquired by a German firm, RWE for $46 a share cash.

America West Holdings (AWA), look at that drop, 65 percent. The company is going to cut service by 20 percent and lay off 2,000 workers.

Sabre Holdings (TSG), which is in the reservations business for travel, down $16.13.

And Carnival (CCL), the cruise line, down $9.09. Legg Mason Brokerage downgraded it from "strong buy"