Economic forecast gives Dow a boost GE, Pfizer, Coca-Cola, are among companies that advanced yesterday

September 13, 1997|By BLOOMBERG NEWS

NEW YORK -- U.S. stocks rose yesterday as reports suggested that the economy continues to grow without inflation, boosting bonds and issues such as General Electric Co. and Pfizer Inc. that lost ground in the past two months.

Stocks battled back late in the day after Motorola Inc. rattled the market by warning that its third-quarter earnings could fall more than 25 percent short of forecasts.

The Dow Jones industrial average rose 81.99, or 1.1 percent, to 7,742.97, after falling 53 points. The Dow, a stable of 30 multinational companies including GE and Coca-Cola Co., is more than 6 percent from its Aug. 6 high.

GE, down 10 percent since mid-July, gained $1.25 to $66.25 yesterday. Drugmaker Pfizer, which fell 18 percent from early July through mid-August, advanced $2.9375 to $58.1875. Coke, down 22 percent from June 13 through yesterday, rose 93.75 cents to $57.0625.

The Standard & Poor's 500 index rose 11.32, or 1.2 percent, to 923.91. The Nasdaq composite index rose 9.47, or 0.6 percent, to 1,649.33.

The Russell 2,000 index, which tracks small-company shares, rallied throughout much of the day, climbing 4.16, or 1 percent, to a record 440.09. Waters Corp., a maker of analytical instruments, led the gains, surging $6.4375 to $40.4375 as investors said its $188 million acquisition of Micromass Ltd. will add to earnings.

Among other broad market indexes, the American Stock Exchange composite index advanced 5.47 to 672.31; and the S&P 400 midcap index gained 4.61 to 325.91. Both were records.

The Wilshire 5,000 index, comprising stocks on the New York, American and Nasdaq stock exchanges, added 100.80 to 8,940.11.

Advancing stocks outnumbered those that declined by 2,094 to 778 on the New York Stock Exchange. Trading totaled 543 million shares, 16 million more than average for the past three months.

For the week, the Dow fell 1.0 percent, the Russell 2,000 rose 1.6 percent, the S&P 500 fell 0.6 percent and the Nasdaq gained 0.8 percent.

Retailers were mixed yesterday after a report that showed slower-than-expected growth in August. Wal-Mart Stores Inc. fell cents to $38.75 and Sears, Roebuck & Co. surged $1.50 to $57.25. Gap Stores Inc. gained $1.6875 to $52.

Also yesterday, the Labor Department reported the first increase of the year in producer prices, a scant 0.1 percent, excluding energy and food costs.

Bonds staged their biggest rally in seven weeks. The yield on the benchmark 30-year Treasury, which moves opposite the price, dropped 11 basis points to 6.58 percent.

Oil service companies surged as expectation of shortages and rising prices was seen boosting demand for exploration and drilling. Pride International Inc. gained $1.5625 to $36.3125 and Diamond Offshore jumped $1.9375 to $58.375. The Philadelphia Oil Service sector index jumped 4.1 percent to 120.39, its highest reading since records began in March.

Harnischfeger Industries Inc., a maker of equipment for mining, papermaking and material handling, rose $3.3125 to $42.8125 on news it will buy back as many as 10 million of its common shares. The company also said it retained Merrill Lynch & Co. to explore the possible sale of P&H Material Handling, Harnischfeger's material-handling equipment and services business.

Ascend Communications Inc. dropped for a third day, bringing its loss in that time to 17 percent, as investors speculated product delays led to price cuts. Yesterday, Smith Barney lowered its third quarter estimate on Ascend to a range of 24 to 28 cents, compared with an average estimate of 34 cents, according to IBES International Inc. Ascend fell $2.5625 to $35.25.

Miller Industries Inc. slumped $4.5625 to $10.375 after its said it will close a car-wrecking plant in Mississippi, resulting in a $2 million charge for the fiscal second quarter.

Pub Date: 9/13/97

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