By James Langton

(October 15 – 13:15 ET) – U.S.
Federal Reserve Board Chairman Alan
Greenspan spoke and the markets
buckled, but they haven’t broken.
He is expected to make another
speech this afternoon, which will
also be closely watched.

In the meantime the TSE 300 is
down about 60 points, less than 1%.
Volume has been rather moderate,
less than 51 million shares,
indicating that while there is
obviously some selling momentum
there’s no panic in the market.
That said the market’s tone is
deeply negative, decliners are
outpacing advancers almost 3:1.
On the volume front, the selling
is more than double the buying,
but there is buying.

Consumer products are up
strongly in the face of the
selloff, almost 1%. The biotechs
and tobacco are notably strong.
Of course tobacco was one of the
big components driving the U.S.
producer price index higher this
morning.

Air Canada has been
strong, on speculation that it will
be able to engineer a friendly
bid to fend off Onex.

Everything else is down. Paper
stocks and anything else that has
shown some strength this week are
being beaten back.
Nortel, BCE, Barrick and
Placer are all leading the
trade to the downside. The software
group is one of the downside
leaders. Corel is part of
that slide, but it is down just
75¢, after re-opening in the wake
of illegal insider trading charges
filed against its founder and
chief executive, Michael
Cowpland.

The financials have been
surprisingly resilient, with
interest rate fears at the core
of this selloff they have held
up remarkably well, led by odd
stocks such as Crown Life and
Great-West Life.

In Montreal stocks are down,
although a little less than the
TSE on a percentage basis, just
about 29 points. The small cap
trade has been rather muted too,
each of Alberta and Vancouver
are down, but less than a point.

In New York traders took
Greenspan a little more
seriously, plunging more than
220 points on the open. Wall
Street has resisted hitting the
panic button though and markets
have bounced back, retested the
lows, and it has held. The Dow
is currently off about 165 points.
Nasdaq is down around 55 points,
and the S&P dropped 22.