Stocks fall amid money jitters Dow industrials shed 16 points, to 8,045

Russell 2,000 hits record

October 11, 1997|By BLOOMBERG NEWS

NEW YORK -- U.S. stocks fell with bonds yesterday as an inflation report deepened concern that higher interest rates will hurt company profits in coming months. Financial shares such as J. P. Morgan & Co. led the decline.

The Dow Jones industrial average fell 16.21 to 8,045.21. The Dow lost 133 points during the past three sessions, though it was up 6 points for the week.

In coming days, a new round of earnings reports may contain enough good news to buoy the market. Intel Corp., General Motors Corp. and J. P. Morgan & Co. are among the companies scheduled to report earnings early next week.

The Standard & Poor's 500 index fell 3.64 to 966.98 yesterday, down from its record 983.12 Tuesday. The Nasdaq composite index dropped 6.82 to 1,739.03.

Among broad market indexes, the Russell 2,000 index of small capitalization stocks added .48 to a record 465.03; the Wilshire 5,000 index, comprising stocks on the New York, American and Nasdaq stock exchanges, lost 25.78 to 9,384.40; the American Stock Exchange composite index increased 0.15 to 717.37; and the S&P 400 mid-cap index slid 0.75 to 338.56.

Some 1,547 stocks fell and 1,318 rose on the New York Stock Exchange, where about 500 million shares traded.

For the week, the Dow gained 0.08 percent, the S&P 500 rose 0.2 percent, the Nasdaq climbed 1.4 percent and the Russell rose 1.3 percent.

Bond yields jumped after the Labor Department said prices paid to factories, farmers and other producers rose 0.5 percent in September. Economists had forecast a 0.2 percent rise.

The yield on the 30-year Treasury bond rose 7 basis points to 6.42 percent. The yield dropped as low as 6.23 percent on Tuesday.

J. P. Morgan lost $1.25 to $118.6875; Banc One Corp. dropped $1.375 to $57; and Mellon Bank Corp. lost $1.9375 to $52.9375.

Chase Manhattan Corp. dropped $3.875 to $121.6875 on concern that its plan to build an investment banking business from scratch will reduce earnings in the next few years. Judah Kraushaar, an analyst at Merrill Lynch & Co., cut the firm's investment recommendation on the bank to near-term "neutral" from "accumulate."

Saf-T-Lok Inc.'s stock was among the most active issues in U.S. trading, rising $1.5625 to $4.5625 as 18.4 million shares changed hands. The stock closed at 43.75 cents Wednesday. The advance came after eight major gun makers agreed to include a child safety lock with every handgun sold.

Waste Management Inc. fell $3.125 to $30.625 after the company said it expects third-quarter profit from operations of 38 cents to 40 cents a share, below analysts' estimates.

General Motors, the nation's No. 1 automaker, rose 68.75 cents to $70, helping limit the Dow average's losses. The company is scheduled to report its third-quarter earnings before the open of trading Tuesday. Analysts expect a profit of $1.21 a share.

Some computer-related shares also bucked the market's decline. Applied Materials Inc. rose 93.75 cents to $104.0625; Dell Computer Corp. rose $2.468 to $100.234; Seagate Technology Inc. jumped $1.75 to $40.0625; Digital Equipment Corp. rose 93.75 cents to $49.50; and PeopleSoft Corp. rose $1.3125 to $62.625.

Siliconix Corp. jumped $2 to $55. Earlier in the week, the semiconductor company said third-quarter profit rose to 84 cents a share from 59 cents a year ago. Sales jumped 31 percent to a record $80.9 million.

SyQuest Technology Inc., Saf-T-Lock, Banco Rio de la Plata SA, Waste Management and Intel Corp. were the most active stocks in U.S. trading.

Banco Rio de la Plata gained $1.625 to $16.625. Demand for the company's initial public offering was more than triple the $732 million of stock being sold by billionaire businessman Gregorio Perez Companc.

Pub Date: 10/11/97

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