Bailout worries hit Dow, S&P, techs help Nasdaq

NEW YORK - The Dow and S&P 500 edged lower on Wednesday as uncertainty about when Congress might approve a proposed US$700 billion financial sector bailout offset Warren Buffett's US$5 billion bet on Goldman Sachs.

Fear that congressional wrangling could delay or weaken the Bush administration's plan to mop up bad mortgage debt from banks' balance sheets kept stocks in check throughout the day.

The Nasdaq, though, clung to slender gains on hopes that technology spending would increase once a version of the bailout plan becomes law. The Dow and S&P declined for the third straight day.

Federal Reserve Chairman Ben Bernanke urged Congress' Joint Economic Committee to pass the bailout, saying delay would keep lenders from extending credit to households and businesses, but lawmakers voiced doubt about the size and scope of the plan.

The Dow Jones industrial average was down 29.00 points, or 0.27 per cent, at 10,825.17. The Standard & Poor's 500 Index was down 2.35 points, or 0.20 per cent, at 1,185.87. The Nasdaq Composite Index XIC was up 2.35 points, or 0.11 per cent, at 2,155.68.

Despite uneasiness about the bailout, traders said Buffett's decision to invest US$5 billion in Goldman Sachs was encouraging. Goldman's stock rose 6.4 per cent to US$133, while the Class A stock of Berkshire Hathaway, Buffett's holding company, added 3.5 per cent to US$133,300.

Source: Singapore Business Times - 25 Sep 2008