Stocks rise again, led by computer shares Dow reaches 7,915.47, its highest level since Jan. 5

volume is high

January 29, 1998|By BLOOMBERG NEWS

NEW YORK -- U.S. stocks jumped again yesterday, led by Oracle Corp. and other computer-related shares, on optimism that corporate profits will top expectations this year as the economy continues to expand.

UAL Corp., the parent company of United Airlines, and aerospace and auto equipment maker AlliedSignal Inc. were among the companies to exceed fourth-quarter earnings estimates. The reports were more evidence that companies are benefiting from increased profits in North America and Europe even as Asia's financial crisis takes a toll on some U.S. businesses.

The Dow Jones industrial average rose 100.39, or 1.3 percent, to 7,915.47, its highest level since Jan. 5. The Dow has added 214 points in three days, although it's up just 7 points for the year.

The Standard & Poor's 500 index climbed 8.44 to 977.46.

The Nasdaq composite index jumped 31.92, or 2 percent, to 1,610.82.

Among other broad market indexes, the Russell 2,000 index of small capitalization stocks jumped 6.07 to 428.60; the Wilshire 5,000 index, comprising stocks on the New York, American and Nasdaq stock exchanges, climbed 89.66 to 9,405.62; the American Stock Exchange composite index added 0.96 to 667.55; and the S&P 400 midcap index gained 5.50 to 325.24.

Computer-related shares rallied as many investors reconsidered whether a recent tumble in the stocks was justified. Oracle rose $2.1875 to $21.1875 after Chairman Lawrence Ellison said he expects North American sales to grow 25 percent in the fiscal third quarter. The database software maker fell 29 percent on Dec. 9 after reporting disappointing earnings.

Tellabs Inc. rose $5.125 to $50.9375; Linear Technology Corp. rose $4.6875 to $66.6875; and Texas Instruments Inc. jumped $3.8125 to $55.3125.

Microsoft Corp. rose $3.8125 to $149 and Motorola Inc. rose $3 to $59.875.

National Semiconductor Corp. rose $1.25 to $27.125 after the company's chief investment officer said he expects revenue to increase in the "high teens" in fiscal 1998. The chip maker's 1997 revenue fell 4.4 percent.

Some 1,919 stocks rose and 1,048 fell on the New York Stock Exchange.

About 711.3 million shares changed hands on the Big Board, the sixth-heaviest day ever and about 21 percent above the three-month daily average.

UAL rose $1.6875 to $88.25 after the airline said fourth-quarter profit rose 63 percent from the year-earlier period, topping analyst estimates, as the airline benefited from heavy passenger traffic, higher fares and lower fuel prices. AMR Corp., the parent of American Airlines, rose $3.0625 to $126.75; Delta Air Lines Inc. jumped $4.25 to $114.375; and Southwest Airlines Co. rose $2 to $27.625.

Procter & Gamble Co., Gillette Co. and Corning Inc. declined amid concern that earnings in Asia will be hurt in coming months. P&G, a Dow member, fell $1.625 to $79.25 and Gillette dropped $2.25 to $100.

Corning, down $3.5625 to $32.3125, and Integrated Process Equipment Corp., down $1.6875 to $13.9375, were among companies warning yesterday that Asia's turmoil will depress earnings in coming months.

Polaroid Corp. fell 37.5 cents to $41.625. The maker of instant cameras and film said fourth-quarter earnings fell 6.5 percent, amid unexpectedly weak U.S. film orders and a rising dollar's erosion of foreign sales. Polaroid also told analysts to lower their estimates for 1998.

Aspen Technology Inc. surged $8.0625 to $34.375.

The software company's fiscal second-quarter earnings beat estimates and analysts said Asian market turmoil shouldn't keep the company from meeting year-end targets.

Charter One Financial Inc. rallied $3.50 to $57.125. The thrift said fourth-quarter earnings rose 8.8 percent, powered by record lending income.

Pub Date: 1/29/98

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