Dow snaps upward trend, slips 6.15

The Ticker

July 12, 1994|By Julius Westheimer

Dragged down by a sagging dollar and lower bond prices, stocks snapped a five-day winning streak yesterday. The Dow Jones industrial average, which climbed 84.18 points last week, slipped 6.15 points and closed at 3,702.99. Around lunchtime, the Dow had been down 28 points.

SPEAKING OF STOCKS: "Question good news about any stock. Some good news, such as changes of CEOs or basic corporate strategies, have dramatic long-term impact. Other kinds of good news, such as surprisingly high quarterly earnings, have little or no long-term impact." (Donald Cassidy, Lipper Analytical Services) . . . Climbing from fourth position last week, U.S. stocks now stand second in one-year investment performance. Here is the latest ranking of the July 6, 1993, to July 6, 1994, results: A $10,000 investment became $12,500 in foreign stocks, $10,400 in U.S. stocks, $10,200 in money market funds, $9,800 in gold, and $9,600 in Treasury bonds. (Data from Business Week, July 11.)

QUOTE OF THE WEEK: "When asked her image of business, Jamila Hubbard, 18, of Fremont, Calif., responded: 'Men, blue suits, coffee.' " (Inc., July.)

SILVER LININGS: "According to a recent survey, property taxes rank second only to income taxes in the burden they place on corporate America. The bright spot is that many businesses reported success in challenging their property-tax assessments." (Inc., July) . . . "Our view is that any tightening by the Federal Reserve will likely be postponed. This is very bullish for investors." (Michael LaTronica, research director, Gruntal & Co.)

NOTES & QUOTES: "You can save money if you know where to buy traveler's checks. American Express charges $1 for every $100 worth, but many local American Automobile Associations (AAA) offer the same traveler's checks free of charge to members." (Consumer Reports, July). Ticker Note: The local AAA waives the charge . . . "Nothing in fine print is ever good news." (Andy Rooney) . . . In response to requests, we repeat the toll-free number for the "Young Investors Fund," (nicknamed "Kiddie Fund") which invests in stocks like Disney, Toys 'R' Us, Gap, Hershey, McDonald's, etc. It's a no-load fund with a $500 minimum. Details: 1 (800) 338-2550.

BALTIMORE SCENE: The Rothschild Co.'s Letter to Clients, July 5, says, in part, "While no one likes to see a decline in stock prices, we believe that the relative values of medium-size growth companies are now more attractive than in many years. When it is possible to buy well-financed industry leaders that are consistently growing at 10 to 20 percent in earnings, at prices below the average market multiple, we consider these stocks to be relative bargains. Companies such as Newell, Grainger, Donaldson, Cisco, Alco Standard and Johnson & Johnson certainly fit this description." For the full letter, write the firm at 32 South St., Baltimore 21202 . . . "The Blaustein Family, Baltimore, Md.," is listed under "The Billionaires" in Forbes, July 18, with primary source of $1.3 billion described as "Inheritance: oil."

MORE ON BALTIMORE: Legg Mason's July "Investor's Dozen" includes Alberto-Culver, Circuit City, Durakon, Figgie International, Hooper Holmes, Kranzco Realty Trust, Regions Financial, Shawmut, Sierra Pacific, Standard Federal Bank, Telefonos de Mexico and Waban . . . Phone Dean Witter's Stephen Stauffer (547-7000) for his firm's "Strategem Letter," which says, in part, "The proof of the pudding is performance. Over the last half-dozen years, convertible bonds have significantly outperformed regular bonds and have nearly matched stock returns. Convertibles are a conservative way to participate in the stock market, with less volatility, plus providing much greater income than typical dividends on stocks."

LAST LINES: The T. Rowe Price International Japan Fund, up 22 percent this year, is listed under "Winners: Year to Date" in Barron's Mutual Fund issue, July 11, available this week . . . "It's not enough just to know whether a mutual fund manager or market letter is aggressive or conservative. A second question to ask is, 'What are the risks and what is the potential reward?' " (Mark Hulbert in Forbes, July 18)

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