Dow index, down sharply, revives on hopeful news


January 12, 1995|By JULIUS WESTHEIMER

Encouraged by a smaller-than-expected inflation increase, rising bond prices and partial stability in the Mexican stock market, investors late yesterday trimmed a sharp midday stock market decline. The Dow Jones industrial average, down 25 points just before lunchtime, climbed during the afternoon and closed with a 4.71-point loss at 3,862.03.

LOCAL SEERS: "After one more Fed rate increase, economic growth will be slower but still positive. This should help ease inflation fears, while still allowing corporations to raise earnings, providing a favorable stock and bond environment." (Myron Oppenheimer, vice president, NationsBank) Call 244-6569 for the "Investment Policy" letter. . . . "Poor performance of many stocks last year has provided many opportunities for investors, namely in banks and insurance issues." (Mercantile-Safe Deposit & Trust Co.) . . . "The Fed's actions will begin to bite unmistakably in 1995." (Louis Rukeyser, 1950s Evening Sun political reporter and for 25 years host of "Wall Street Week")

YOUNGER SET: "Ten Things You Must Do For Your Kids," in Kiplinger's Personal Finance Magazine, February, is worth reading. Highlights: "Get your child a Social Security number . . . Make a will and name a guardian . . . Buy enough insurance . . . Start saving for college . . . Talk to your kids about money when they're young . . . Talk to your kids about money when they leave home . . . Revise your will and other beneficiary arrangements . . . Save for retirement . . . Give some money to your children . . . Spend some money on yourself."

TOWSON TALK: A Business Week (Jan. 16) article begins, "Nolan Archibald had had it. When the chairman and CEO of Black & Decker Corp., Towson, Md., heard last spring that Washington Bullets season-ticket prices for 1994-95 would leap 30 percent, he called Bullets President Susan O'Malley to say he was considering canceling his company's order . . . Then O'Malley went to work. She called Archibald repeatedly, begging him to hang on for one more season . . . O'Malley just wore him down. 'If it hadn't been for Susan,' he says, 'we wouldn't have hung in there.' "

MIDWINTER MEMOS: Your rights as an airline passenger are spelled out in a booklet, "Fly-Rights," which covers bumping, delayed or canceled flights, lost tickets and luggage plus other nightmares. For a copy, send a $1.75 check to Sup't. of Documents, Box 371954, Pittsburgh, Pa. 15250. Mention stock number 050-000-00553-4 . . . Did you realize that 98 percent of NYSE stocks are off at least 10 percent from their Jan. 1, 1993, to March 31, 1994, highs? And that 78 percent are down 20 percent, and 45 percent are off 30 percent from their peaks?

BUSINESS BEAT: "Beating Back the Postal Rate Hike" in Fortune, Jan. 16, offers these five ways to save in the mailroom: "Automate; presorting and pre-barcoding earn discounts . . . Clean up your mailing lists; the addresses on it should actually exist . . . Consolidate; send out more in each envelope . . . Don't use dark envelopes; documents that can be read by machine are cheaper to process . . . Outsource your mail center if you send less than 100,000 letters a year."

HOPEFULLY HELPFUL: The American Association of Retired Persons offers free income tax assistance to people over age 60 at 11,000 sites around the country. To find out where you may receive help, call 1-800-829-1040.

If you want to purchase Treasury bills, notes or bonds directly, contact the nearest Treasury or Federal Reserve Bank office to get the forms and instructions you need. In the Baltimore area, write Federal Reserve Branch, Box 1378, Balto., Md. 21203 (502 S. Sharp St.) or phone 410-576-3553.

BRIEF REMINDER: Our 1995 Dow Jones forecasting contest is under way, with dinners, lunches and books for the winners; details in last Tuesday's Ticker, and we'll repeat them next Tuesday. Postmark deadline is midnight Sunday, Jan. 29.

FROM THE MASTER: Peter Lynch, legendary manager of the top-performing Fidelity Magellan Fund for many years ($1,000 invested in the fund in 1977 was worth $28,000 by 1990 when Mr. Lynch retired) is interviewed in Modern Maturity, Jan.-Feb. issue.

Highlights: "I'm a dyed-in-the-wool fan of the do-it-yourself school of investing; a savvy amateur can outperform Wall Street big shots by checking out products at local shopping malls . . . Take a 20-year view of the market; you shouldn't be in stocks if you have a one- or two-year horizon.

"When people buy a house, car or refrigerator, they do research. When they buy a stock, they get a tip on the bus and buy the stock before sunset without knowing anything about the company. . . .

"It's a funny business; you don't have to be right even half the time. If you invest $1,000, all you can lose is $1,000. If you're right, you can make $10,000 or $50,000."

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