Stocks fall, with banks showing the way Dow industrials shed 30 points, to 7,700

computer issues strong

Wall Street

January 24, 1998|By BLOOMBERG NEWS

NEW YORK -- U.S. stocks fell yesterday for a third day on concern that slowing Asian economies will damp profit growth in Citicorp, J. P. Morgan & Co. and other banks led the decline.

The Dow Jones industrial average fell 30.14 to 7,700.74. The 30-stock average declined 0.7 percent for the week and has lost 2.6 percent so far this year. The Standard & Poor's 500 index fell 5.46 to 957.58, and was down 0.4 percent for the week.

The Nasdaq composite index fell 0.58 to 1,575.93 yesterday. The Nasdaq outperformed the Dow and S&P on the week, rising 0.8 percent.

Among other broad market indexes, the Russell 2,000 index of small capitalization stocks slid 1.39 to 424.81; the Wilshire 5,000 index lost 50.37 to 9,146.39; the American Stock Exchange composite index dropped 3.98 to 661.63; and the S&P 400

mid-cap index slipped 1.55 to 319.94.

Computer stocks gained, helping prevent further losses. Gateway 2000 Inc. jumped $3.125 to $37.125 after the maker of personal computers hired a top AT&T Corp. executive as its president and reported unexpectedly strong fourth-quarter earnings. Gateway benefited from lower prices for memory computer chips, disk drives and microprocessors, partly as a result of declines in Asian currencies.

Rival Compaq Computer Corp. rose 62.5 cents to $31.75 and Dell Computer Corp. gained $2.3125 to $94.8125.

The day's most active stock was Iomega Corp., which tumbled $3.9375 to $8.8125 in New York Stock Exchange trading of nearly 29 million shares. The maker of portable disk drives blamed slowing demand in Asia for fourth-quarter earnings below analysts' estimates.

Digital Lightwave Inc. tumbled $6.1875 to $4.9375 after the phone equipment maker said it expects to report a loss for 1997 because of an accounting change and an order delay in the fourth quarter.

Companies such as J. P. Morgan and International Business Machines Corp. warned investors this week that slumping Asian economies will curb profit growth in the first quarter. Merrill Lynch & Co. said the events in Asia would make 1998 "a more challenging environment for our industry."

The debt crisis in Indonesia deepened yesterday as BankAmerica and several other international banks froze lending the country. The rupiah plunged as much as 20 percent, making it almost certain that Indonesian companies won't be able to service their $65 billion in foreign loans.

Citicorp slid $1.8125 to $113.125; J. P. Morgan dropped $3.5625 to $99.3125; BankAmerica Corp. fell $1.625 to $64.1875; and First Chicago NBD Corp. lost $2.25 to $72.50.

Scientific-Atlanta Inc. fell $1.625 to $14.9375 after reporting unexpectedly low fiscal second-quarter profit because of slowing business abroad.

Xerox rose $4.625 to $76.75. It said fourth-quarter profit rose 23 percent, topping forecasts.

Cable television stocks fell on concern that a nine-month rally has run its course, analysts said. Cablevision Systems Corp. shares fell $.0625 to $0.9375; Cox Communications Inc. fell $1.25 to $38.125; and U S West Media Group fell 37.5 cents to $28.25.

Gold stocks had their best day in five weeks as the precious metal jumped $9 to $300.30 an ounce.

Newmont Mining Corp. rose $3.375 to $30.0625; Homestake Mining Co. added 68.75 cents to $9.5625; and Barrick Gold Corp. jumped $1.4375 to $19.0625.

AMR Corp. fell $4.5625 to $124.9375 after the parent of American Airlines agreed with British Airways PLC to exclude key routes, such as New York-London, from their planned alliance in a bid to win European Commission approval.

Pfizer Inc. fell 56.25 cents to $78.0625. The drugmaker said after the market closed Thursday that it wouldn't apply for U.S. Food and Drug Administration approval of its droloxifene drug for treatment of breast cancer.

Pub Date: 1/24/98

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