In Owings Mills, Md., Monday morning, T. Rowe Price prepared for a major accident. Expecting a flood of nervous phone calls, the mutual fund giant put 200 employees on standby to support its usual staff of 100 telephone representatives.
But by noon it was clear that the company was more nervous than its investors. Wayne O'Melia, president of the service operation, said that only about 50 of these extra hands were needed because calling volume ran only about 10 percent above normal. "This is a nonevent compared with '87," O'Melia said.Like O'Melia, financial professionals and individual investors everywhere Monday seemed to be awaiting a disaster that did not come. From the floor of the New York Stock Exchange to the headquarters of the National Association of Securities Dealers in Washington, the mood in the morning was tense.
But as investors who fled the market last week stepped up to buy again Monday afternoon, the weekend's awful warnings faded and Wall Street's naturally bullish bias returned -- at least for the moment. By day's end, many professionals were even saying that last week's plunge, although painful, might have done some good by ending a speculative bubble and clearing the way for a steady, but slower, advance.
"We are seeing a whole different side of the market that we didn't see Thursday or Friday," said Joseph Cangemi, a floor supervisor on the New York Stock Exchange with Francis P. Maglio & Co. "You are seeing a bounce off the bottom with the fresh money coming in."
"This is healthy," he added. "Today is a good reaction. There was a lot of excessive value in the market. It needed to self-correct, to even itself out. People can't keep buying so one-dimensionally and expect a return with no risk."
In Washington, Patrick Campbell, chief operating officer of the National Association of Securities Dealers, arrived Monday prepared for another rough day. Instead, the data flashing on more than a dozen video screens in the windowless room signaled an orderly morning on the NASDAQ.
The biggest scrum Campbell saw Monday was outside the NASD's Washington headquarters among people protesting against the World Bank and the International Monetary Fund. Inside the NASD building on K Street, away from the sirens and helicopters and police bullhorns, the "war room," where top NASD officials keep watch on the NASDAQ, was a relative oasis of calm, Campbell said.
Looking back later, Campbell said, "A lot of the first hour was the emotional part." But once the market absorbed selling by investors who had to raise cash to pay off loans used to buy stocks, buyers were lured back by the prospect of strong earnings reports and a fundamentally sound economy.
"I think things have stabilized here," he said.