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The leading market indices fell sharply this afternoon on heavy trading as technology issues struggled to hold ground beside sagging blue chips. Despite an upbeat rhythm in early trading this morning, the Dow Jones Industrial Average dipped as low as 10,917.27 at mid-day before closing down 243.54 at 11,008.17. The NASDAQ composite closed down 139.32 to 4,096.08 after running as high as 4,303.15, while the heaviest volume ever recorded, or 1.96 billion shares, changed numerous, nervous hands. Lackluster corporate earnings have lately spawned irrational fears of an interest-rate hike to offset (largely imaginary) inflationary pressures. There seems nothing that Federal Reserve Chairman Alan Greenspan can do to dissipate rumours that a hike is inevitable. Investors are determined to see every conceivable glitch as grounds for one, and remain unlikely to be satisfied until one is prescribed. The Fed is due to meet on 1 February, though last week Greenspan indicated, in his characteristically cryptic way, that no such decision has been reached. His appearance tomorrow before a Senate budget committee will, no doubt, captivate investors and analysts keen to divine some whiff of insight into his plan. And even if a rate-hike is in the cards, last year's record indicates that it's unlikely to impede consumer demand. The technology sector ended largely down today. Intel did rise 13/16 to 98 13/16, but pronounced slackness in Cisco, Oracle, Dell, Sun and other big-brand tech issues undercut that modest gain in the aggregate. Meanwhile, Yahoo fell a whopping 27 5/8 to 324 5/16, helping to offset Amazon.com's 8 1/14 rise to 70 1/8. It was a good day for Amazon, which also announced increasing its stake in Drugstore.com, thereby boosting it 5 1/2 to 35 on the news. Time Warner fell 3 1/2 to 87 5/8 on news of its intended merger with EMI. On the New York Stock Exchange, losers led 2,029 to 1,028 on a volume of 1.1 billion shares. On the NASDAQ Stock Market, losers led 2,399 to 1,802 on the record volume of 1.96 billion shares. Analysts are divided on whether this year's unusual market volatility indicates systemic weakness, or whether the market can sustain this sort of reciprocal momentum indefinitely with no long-term negative consequences. There are various grumblings that the technology sector is due for a correction, but no one to whom The Register talks regularly expects it to represent a long-term setback for the sector as a whole. So far as we can tell, investors with significant tech holdings would do well to ride out all but the most obviously hopeless tailspins. So damn the torpedoes; steady as she goes. ®

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