Who can see into market's future?

The Ticker

May 19, 1994|By Julius Westheimer

Moving higher for the fifth consecutive day, the Dow Jones industrial average advanced 12.28 points on heavy volume yesterday, closing at 3,732.89. The Nasdaq composite over-the-counter index was also strong, up 10.37 points, to 721.37. Short-term interest rates continued to ease.

AND NOW WHERE? "I don't think this is a bear market." (Laszlo Birinyi, who has been the most accurate stock market forecaster of all 10 technicians on "Wall Street Week With Louis Rukeyser." Also, his stock picks gained 19 percent for the first quarter of 1994 vs. a 4 percent loss for the S&P 500 stock index.) . . . "Bull markets die with a whimper, not a bang. The recent plunge indicates higher prices ahead. Load up now." (Kenneth Fisher, money manager) . . . "This market is really sick. Build up your cash reserves in preparation for buying opportunities you will have at the start of the next bull market." (Cabot Market Letter) . . . "Corporate earnings are strong and rising, and stocks are fairly priced. A better stock market showing is likely in time." (United & Babson Investment Report) . . . "In investing, your investments should depend on whether you want to eat well or sleep well." ( The 1994 Stock Trader's Almanac)

AUDIT AHEAD? "If it's your misfortune to face a tax audit, take these tips: It's fair play to protect yourself. . . . Don't give a foot when an inch will do. . . . Postpone the audit for a month, allowing you time to get your data together and your return to fester on the auditor's desk while more pressing problems close in on him/her. . . . Schedule the audit late in the day, or on Friday . . . Don't volunteer more information than you need to. . . . Pay a lawyer, CPA or enrolled agent -- someone who has passed an IRS exam -- to represent you. . . . Throw the dog a bone; most auditors feel it isn't a tax return if they can't find something wrong with it." (Jack Warren Wade, former IRS revenue officer, from his book, "When You Owe the IRS," summarized in Men's Health, June)

MONEY SAVERS: Ask your broker about "B" shares of "load" mutual funds, where you do not pay any front-end load (commission). In most cases, you pay no load at all if you hold the funds five years or more. . . . "Summer is approaching and children will soon begin vacations from school. For tax-wise parents, summer presents a possible tax-saving opportunity. Consider the tax benefits of hiring your child in your business or profession. The economics make sense. If you're in the 39.6 percent tax bracket, hire your 17-year-old child and pay the child $3,800. If your business is not incorporated, claim a $3,800 tax deduction." For full details, phone Harry B. Gorfine & Co., 539-5474, for the firm's bulletin, "Hiring Your Child This Summer."

LOCAL LINGO: Myron Oppenheimer, vice president, NationsBank, sends his latest Investment Overview, which reads, in part, "Any stock market correction is cause for concern because no one knows when it will end. But there are positive factors at work -- general economic strength and, more importantly, increased earnings growth being shown by many companies. First-quarter earnings should be positive for stocks." Phone Mr. Oppenheimer (244-6569) for your copy of this report, covering bonds, interest rates, inflation, etc. . . . "Alex. Brown raised its rating on Tiffany & Co. from a hold to a buy." (CNBC News) . . . Potomac Electric Power, widely held locally and now yielding 8.6 percent, is listed in a Legg Mason report under "Largest Companies With No Nuclear Generation." Call Gerald Scheinker (486-8010) for your copy of the entire report, titled "Nuclear Power Perspective: Electric Utility Report." . . . T. Rowe Price Capital Appreciation Fund is listed under "Funds That Protect Your Investment" in Kiplinger's Personal Finance magazine, June.

MORE LOCAL: Sandler Systems Inc., Stevenson, (800-638-5686) and Sylvan Learning Systems, Columbia, (800-284-8214) are local firms listed under "The Nation's Best Franchise Buys," subtitled, "Best Buys Under $100,000" in National Business Employment Weekly, May 15-21 issue. . . . "One reason we are attracted to 'cyclical' stocks is that the measures these companies have taken to become more competitive will produce surprising profit results." (Investment Counselors of Maryland) . . . McCormick & Co. is written up extensively under "Company Focus" in The Patient Investor, May. "We continue to regard management as one of McCormick's strengths. CEO Bailey Thomas is a 30-year veteran of the company and an important part of its restructuring during the late 1980s." . . . Dean Witter's Rick Faby will mail excerpts from his firm's 80-page brochure, "Market Watch and Investment Strategy," if you phone him at 583-5278. "We are stuck in an environment that will find the Fed moving short-term rates higher . . . and this will slow growth of earnings."

MAY FLOWERS: "SteinRoe Funds will soon launch the SteinRoe Young Investor Fund, a mutual fund that will invest at least 65 percent of its assets in 'kid-related' companies, like Disney, Gap, and Toys 'R' Us." (Business Week, May 23) . . . "Barry Abramson, utility analyst at Prudential Securities, still likes a bunch of utilities. His top three choices -- General Public Utilities, Southern Co. and Duke Power -- have yields below the industry average of 7 3/4 percent but their dividends look secure and their competitive positions strong." (Barron's, May 16, on newsstands this week.)

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