Dow surges on easing Whitewater fears

March 12, 1994|By Bloomberg Business News

NEW YORK -- U.S. stocks rallied yesterday as interest rates fell and concerns about President Clinton's political troubles eased.

"The stock market followed the path of bonds again," said James Solloway, director of research at Argus Research. "As far as Whitewater goes, things seems to have calmed down and people are waiting to see more information come out."

The Dow Jones industrial average surged 32.08, to 3,862.70, after being down as much as 14 points yesterday morning. J. P. Morgan & Co. and United Technologies Corp. led the advance. The average fell 22.79 Thursday, to its lowest level since Jan. 7.

In the broader market, Standard & Poor's 500 rose 2.54, to 466.44, after falling 3.16 Thursday. Banks, automakers and telephone companies led the index higher.

The Nasdaq Combined Composite Index rose 0.11, to 789.20, after plunging 3.95 Thursday. Microsoft Corp., Applied Materials Inc. and Nordstrom Inc. were among the biggest gainers.

Nine stocks rose for every seven that fell on the New York Stock Exchange. Trading was active, with more than 305 million shares trading hands.

Stocks of financially sensitive companies rose as interest rates fell. S&P's indexes of financial companies, regional and money center banks rallied the most. Among the largest gainers, Citicorp was up $1.125, to $39.375; and Merrill Lynch & Co. rose $2.375, to $43.25.

"Any time rates move, everyone acts with a gut reaction," said Paul Mackey, bank analyst at Dean Witter Reynolds. "These stocks are perceived to be interest-rate sensitive."

Stock prices were also boosted as shares of defense companies rose on Northrop Corp.'s hostile bid for Grumman Corp. After agreeing on Monday to be acquired by Martin Marietta Corp. for $55 a share in cash, Grumman received a $60-a-share offer from Northrop after Thursday's market close.

Grumman stock climbed $3, to $64.75; United Technologies rose $2, to $69.75; Lockheed Corp. rose $1.25, to $67.375; and Boeing Co. rose 75 cents, to $47.625. Martin Marietta fell $2, to $44.50.

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