Dow drops 30 as investors on selling binge

The Ticker

March 22, 1994|By Julius Westheimer

Fearing another interest rate boost when the Federal Reserve Open Market Committee meets today, investors sold stocks heavily yesterday. The Dow Jones industrial average fell 30.80 points to close at 3,864.85. All key indexes finished lower.

At yesterday's closing bell, the Dow wallowed 114 points below TC its all-time high, but still remains 110 points above its Jan. 1, 1994, level.

AND NOW WHERE? "The bull market is over. Don't expect a U.S. stock market crash. Expect, instead, a slow, grinding bear market." (A. Gary Shilling, economic consultant, in Forbes, March 28) . . . "The Federal Reserve Board's move to hike short-term interest rates, the first such action in five years, serves this warning to investors: The days of lower rates -- the fuel for the bull market of the last 3 1/2 years -- are over for now, and the risks of owning stocks are higher than at any time since mid-1990." (Kiplinger's Personal Finance Magazine, April) . . . "Since the 1960s, 12 months after Fed tightening, the U.S. market has risen on seven out of 10 occasions, but the average increase was only 4 percent. Returns from the overall equity market may be subdued in 1994." (Investment Counsellors of Maryland, Craig Lewis.)

MONEY-SAVER: "Pay your credit card bills as soon as they arrive if you carry -- or intend to carry -- a balance. Reason: Most banks calculate credit card interest on your daily balance, so the longer you wait, the more you'll have to pay in finance charges. Important: It only pays to delay paying credit card bills until the date they are due when you intend to pay off the entire amount and there is no previous balance." (Gerri Detweiler, executive director, Bankcard Holders of America, 500 Herndon Parkway, Herndon, Va. 22070.)

WARM THANKS: My heartfelt thanks to everyone who offered prayers, sent cards, wrote letters, etc., during my recent open-heart surgery. I am sure that your warm feelings helped to pull me through.

JOB HINT: "Find job opportunities in news stories rather than in classified ads. Study stories of business expansions, promotions, reorganizations, contracts and new-product introductions. Look for hints that a company needs new people, specifically those with your skills. Useful: Focus on reports of promotions, which many newspapers [including this one] publish frequently. Newly-promoted executives often have their own agendas and look outside the company to clean house." (Kenneth Elderkin, management consultant, Dedham, Mass.)

LOCAL LINE: Legg Mason's latest "Investor's Dozen," which the firm's Gerald Scheinker (486-8010) will mail you, with supporting statistics, includes Advanta, Ameron, Durakon, First Commerce, Harcourt General, Imo Industries, Instrument Systems, Kranzco Realty Trust, Lone Star Technologies, Ross Stores, Shawmut National and SPS Technologies . . . Phone 547-2124 (Steven Norwitz) or write T. Rowe Price, 100 E. Pratt St., Baltimore 21202, for an excellent 32-page booklet "Tax Considerations for Investors" . . . Signet Banking is listed under "Where 5-Percent-Plus Dividend Hikes are Expected" in S & P Outlook . . . PaineWebber's Marvin Fribush (576-3220) will mail a report on Town and Country Trust, "a Baltimore-based REIT run by a financially astute and experienced management team."

WHEN TO SELL: "Buying stocks is easy; selling them is hard. Many otherwise intelligent investors sabotage their stocks' performances by not recognizing the signs to bail out. Here are a few criteria: Sell when you reach your target price . . . Sell if the fundamentals worsen . . . Sell when the reason you bought the stock is no longer valid . . . Sell when your stock is technically weak." (Douglas Raborn, investment manager, Delray Beach, Fla.)

LIVING CHEAP: From "Living Cheap News," here are a few random money-saving ideas: "Use postcards instead of letters, saving 34 percent on postage . . . Don't carry credit-card balances; pay them off every month . . . If you smoke, stop. A pack-a-day habit costs about $730 a year . . . Buy your clothing at thrift, resale and consignment stores . . . Go through your closets, and what you can't or won't wear should go to a consignment store."

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