Dow Shakes Off Hong Kong Plunge

Blue-chip stocks bounced higher Monday despite another rough day overseas, as bargain hunters took advantage of an early slide that pushed some popular averages to the lowest level since the market selloff last fall.

The Dow Jones industrial average slid 137 points in the opening minutes, sinking below 7,500 for the first time in two months, but rose 66.76 to 7,647.18 by the closing bell after changing course three times during the session.

The broad market was mixed, with most indexes posting modest gains, but declining issues outnumbered advancers by a wide margin.

Stocks slid at the open, extending Friday’s 222-point slide by the Dow, after investors woke up to a sharp selloff in Southeast Asia for the fourth straight session, this time in Hong Kong.

Technology shares, considered especially vulnerable to the economic trouble in Asia, were instrumental in the turnaround.

“This volatility is going to be the name of the game for weeks to come,” said Ricky Harrington, a technical analyst at Interstate/Johnson Lane in Charlotte, N.C., calling the rebound “an expected occurrence after a drop of 500 points (by the Dow). The market catches hold and you get some bandwagon effect to the upside.”

Volume was extremely heavy again, with 705.45 million shares traded on the New York Stock Exchange, the sixth-biggest tally in NYSE history.

Some of the stocks that moved substantially or traded heavily Monday:

NYSE

American Banknote, down 13/16 at 4-1/16.

The provider of transaction documents and processing systems warned late Friday that it will report disappointing fourth-quarter results due to weak revenues in Brazil and Australia.

NASDAQ

AirTran Holdings, down 19/32 at 3-9/16.

A fall inspection by federal officials found serious safety-related violations at the air carrier formerly known as ValuJet Airlines, The Plain Dealer of Cleveland reported Sunday. The airline, now called AirTran Airlines, said it would sue the newspaper if the report wasn’t retracted.

PhyCor, down 3-3/8 at 19.

The physician-management company warned that costs associated with last week’s collapse of its merger with MedPartners will lower PhyCor’s pretax first-quarter earnings by $15 million. PhyCor, based in Nashville, Tenn., also said its pretax results would be reduced by $22 million due to costs associated with consolidating facilities to cut costs.