Dow index rises 86.44 telephone shares rally

Slowdowns overseas seen benefiting U.S. firms by keeping interest rates low

November 14, 1997|By BLOOMBERG NEWS

NEW YORK -- U.S. stocks rose yesterday on expectations that the economic slowdowns in Asia and Latin America ultimately will benefit companies by keeping U.S. interest rates low. AT&T Corp. led a rally in telephone shares.

The Dow Jones industrial average rose 86.44 to 7,487.76. The Dow began the day with an 87-point gain, tumbled to a 51-point loss and bounced back in a furious rally late in the session.

Federal Reserve Chairman Alan Greenspan told Congress yesterday that weakening economies in Asia will brake U.S. growth. Investors said that makes it unlikely that an overheating U.S. economy will speed inflation and drive bond yields up from their 21-month lows.

AT&T rose $2 to $48.75 for the biggest percentage rise among the Dow industrials.

Sprint Corp. rose $3.25 to $57.50 and BellSouth Corp. gained $1.0625 to $49.625.

The Nasdaq composite index rose 16.02 to 1,557.74, and the Standard & Poor's 500 index added 10.70 to 916.66.

On the broader market, the Russell 2,000 index of small capitalization stocks slid 0.05 to 423.39; the Wilshire 5,000 index, comprising stocks on the New York, American and Nasdaq stock exchanges, climbed 73.78 to 8,823.61; the American Stock Exchange composite index slipped 1.18 to 666.86; and the S&P 400 midcap index gained 0.90 to 312.92.

Declining stocks outnumbered advancers 15 to 14 on the New York Stock Exchange. Trading totaled 654 million shares, the heaviest day since Oct. 30. Trading has recently averaged about 555 million shares a day.

Chase Manhattan Corp. fell 50 cents to $107.25 after disclosing that it lost $160 million in trading, primarily in Latin America, and that it won't meet its announced goal of 15 percent annual growth this year.

Computer-related shares, which plunged Wednesday on concern that Southeast Asia's financial woes would hurt their profits, rebounded yesterday. Texas Instruments Inc. rose $3.75 to $97.50, after losing $12.50 points Wednesday. Dell Computer Corp. rose $5.0625 to $77.0625.

In the Dow, General Motors Corp. fell 56.25 cents to $62.25 and DuPont Co. lost $2 to $57.

Oil drilling and equipment stocks tumbled for a sixth session. Cooper Cameron Corp. lost $3.625 to $70; Tidewater Inc. fell $3.375 to $62; and Halliburton Co. fell $2.8125 to $53.50.

Westinghouse Electric Corp. rose $1 to $28.875 after a person familiar with the situation said the company is poised to sell its conventional power generation units to Siemens AG, a German electronics and engineering company, for $1.5 billion in cash. Siemens will assume some Westinghouse debt.

CIT Group Inc. jumped $3 to $30 after the diversified financing company sold 31.5 million Class A shares in an initial public offering at $27 each.

Metro-Goldwyn-Mayer Inc. shares rose $1 to $21 in their first day of trading.

Holmes Protection Group Inc. rose $1.75 to $19.25 after the company, which provides security alarm monitoring services, said it has hired J. P. Morgan & Co. to advise it on "strategic alternatives," such as a sale or merger. The company said its third-quarter loss widened to 24 cents a share from 15 cents a year earlier.

Pub Date: 11/14/97

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