Wall Street's abrupt scare by the specter of inflation produced the worst weekly loss in more than a year for investors in Washington area stocks, knocking nearly 5 percent off the price of the average share of companies based in the District, Maryland and Virginia.
The Washington Post-Bloomberg regional stock index--which tracks more than 200 of those companies--fell 2 percent yesterday when the Dow Jones industrial average dropped 2.6 percent. The regional index ended the week down 4.7 percent, while the Dow was off 6.3 percent.
Regional stocks have not had such a bad week since last October, when the near-collapse of the investment firm Long Term Capital Management triggered a retreat from the stock market that trimmed 7 percent off the value of the index.
The most important losers among major companies included Lockheed Martin, which dropped $1.87 1/2, ending the week down $6.70 at $24.12 1/2, a loss of 22 percent. Lockheed's loss also dragged down the stock of Comsat Corp., with which it plans to merge. Comsat ended the week at $22.25, down $5.87 or 21 percent.
General Dynamics plunged from $61.71 1/2 to $52.12 1/2, a 15 percent loss for the week. US Airways Group Inc. sank from $32.75 to $27.56 1/4, off 16 percent. District bank holding company Riggs National Corp. dropped $2.25 to close at $15.87 1/2, off 12 percent, and Falls Church-based credit card issuer Capital One Financial Corp. fell $9.65 1/4 to $36, off 23 percent.
High-flying high-tech stocks were also battered, with America Online Inc. losing $6 yesterday and $12.81 1/4 for the week, a 10.5 percent loss. PSINet stock fell $2.65, to $33.87 1/2, producing a weekly loss of $7 or 17 percent.