Stock market slide batters state companies, investors
Wall Street Many state-based stocks take a loss, but some see silver lining

BY DON MECOY

Published: October 7, 2008

Gripped by a frozen credit market, economic fears and a wave of selling, the stock market swooned on Monday, and delivered a blow to Oklahoma companies and investors.

"We are in the throw-in-the-towel stage,” Tulsa money manager Fred Russell said. "We are seeing the beginnings of a capitulation and a fire sale.”

Russell, however, said he was buying beaten-down stocks on Monday, including some state-based issues.

"The mood is bad; the prices are low. What more could a long-term investor want?” said Russell, president of Fredric E. Russell Investments.

The Dow’s skidded 800 points — its largest-ever point drop — before recovering to close with a loss of 370 points. The Dow ended below 10,000 for the first time since 2004.

Crude oil futures slid 6.5 percent to close at an eight-month low of $87.81, and natural gas futures fell to an 11-month low.

Nearly all state-based stocks suffered losses. Dollar Thrifty Automotive slid 26 percent; Hiland Partners fell 24 percent; Panhandle Oil & Gas was down 18 percent. The state’s blue chips were not spared: Devon Energy lost 6 percent, Williams fell 7 percent; and Chesapeake Energy dropped 8 percent.

The market downturn has profoundly affected the paper wealth of some shareholders. Chesapeake Energy Chairman Aubrey McClendon has seen the value of his 33.5 million Chesapeake shares plummet more than $1.5 billion since the stock price peaked in July.

Bob Rader, senior vice president at Capital West Securities in Oklahoma City, said large redemptions in hedge funds and mutual funds combined with heavy losses in European markets kept buyers off Wall Street at the opening bell.

"When there are no buyers, it’s just mass liquidation across the board,” Rader said. Later in the day, bargain hunters moved the market off its unprecedented lows, Rader said.

This tumultuous market is no place for investors who will need their money in the next few years, said Kenny Divelbiss, Oklahoma City-based branch manager with LPL Financial. But it could be a boon to those willing to ride out short-term losses, Divelbiss said.

"It will recover,” Divelbiss said. "I haven’t even thought about selling one penny of my own stuff. I’m very bullish.”

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