“The destruction of the space shuttle Columbia, which filled the airways and newspapers all weekend, adds to the list of bad news investors have absorbed recently, including the threat of a war with Iraq, a nuclear standoff with North Korea, declining consumer confidence and slowing corporate earnings growth,” writes Jonathan Fuerbringer in today’s New York Times.

“But unlike the other events, it does not appear that the shuttle tragedy should have a significant impact on consumer confidence or on financial markets, several analysts said yesterday. One reason is that the destruction of the shuttle has not been linked to anything, like terrorism, that would point to increased risk in the future.”

“Even before the latest round of bad news, several strategists and economists argued that investors should effectively ignore the possibility of a war with Iraq in their investment decisions, although they agreed that the war threat has been a drag on the economy and the stock market.”

“Instead, they said, investors should concentrate on the economy and if they thought a rebound was likely this year, then it was a good time to buy stocks. Some analysts even said that the start of a war with Iraq would give the stock market a lift, as the fighting could end the uncertainty of what will happen and when.”

” ‘The only way this has an effect, to my view, is if it is tied into terrorism,’ James W. Paulsen, chief investment officer at Wells Capital Management in Minneapolis, said yesterday, speaking of the shuttle’s breakup as it re-entered the atmosphere on Saturday morning.”

“Douglas R. Cliggott, president of B& P Research, said, ‘It is clearly a huge personal tragedy for the seven families involved, but in terms of trying to map it into confidence and spending, I don’t think it is going to register very high.’ “

“That does not mean that stocks of companies involved in the shuttle program will not fall as investors worry about what caused the breakup of the shuttle. But, analysts said, it will probably take a more direct link to a faulty part for a company’s stock to face major selling.”

“Boeing and Lockheed Martin, through an equal equity stake in United Space Alliance, are the main contractors for the shuttle program. There are more than 120 subcontractors, including Honeywell and Alliant Techsystems.”