NEW YORK -- U.S. stocks rose to records yesterday, recovering from Tuesday's losses -- and then some -- as investors shoveled cash into equity mutual funds. Microsoft Corp. led the rally.
The Dow Jones industrial average rose 87.68, or 1.1 percent, to 8,457.78, its first record in a week. The Standard & Poor's 500 index gained 12.34, or 1.2 percent, to a record 1,042.90, and the Nasdaq composite index rallied 27.77, or 1.6 percent, to 1,766.48, also an all-time high.
Among other broad market indexes, the Russell 2,000 index of small capitalization stocks rose 4.19 to 458.49; the Wilshire 5,000 index of stocks on the New York, American and Nasdaq exchanges climbed 107.49 to a record 9,941.85; the American Stock Exchange composite index gained 4.29 to 691.79; and the S&P 400 midcap index added 4.57 to a record 350.10.
The Bloomberg Maryland index, which tracks the 100 biggest companies in the state, rose 3.47 points to 223.87, its eighth record of the year.
An estimated net $5.31 billion funneled into equity funds in the one-week period ended Monday, up from about a net $945 million in the prior week, according to Trim Tabs Financial Services Inc., which tracks mutual fund money flows. A big chunk of the mutual fund investments in the latest week, about $3.04 billion, went into "growth" and "aggressive growth" stock funds, Trim Tabs said.
NationsBank Corp. rose $2.50 to $68.875, still below its record of $71.1875 set in August, and Chase Manhattan Corp. rose $2.625 to $122.375, below its Oct. 7 peak of $126.375.
Advancing issues led decliners 2 to 1 on the New York Stock Exchange, where about 611 million shares traded, above the three- month daily average of 585 million.
Microsoft rose $2.8125 to a record $84.9375, gaining for a sixth day. Investors began piling back into the world's largest software maker and other computer-related stocks in mid-January amid growing confidence that earnings growth will hold up this year.
Hewlett-Packard Co. rose $2.0625 to $64.625 and International Business Machines Corp. gained $2.75 to $105.25.
Drug shares rebounded from Tuesday's decline, sparked by news that SmithKline Beecham PLC and Glaxo Wellcome PLC called off a planned merger. SmithKline rose $3.5625 to $63.5625 after falling $6 Tuesday, and Glaxo rose $1.75 to $57.25, after slumping $6.4688 Tuesday.
Pfizer Inc. rose 87.5 cents to $88.375; Eli Lilly & Co. rose $1.4375 to $65.375; and Schering-Plough Corp. gained $1.0625 to $75.9375.
United Technologies Corp., which makes Pratt & Whitney engines and Sikorsky helicopters, rose $2.6875 to $87.50 and led the Dow industrials higher.
J. P. Morgan & Co. rose $2.125 to $118.125, adding to yesterday's 3.2 percent gain after the company said it will fire about 5 percent of its employees.
Dura Pharmaceuticals Inc. fell $14.1875 to $23.9375 after warning that 1998 earnings will be at least 35 percent below expectations because of increased competition from Glaxo Wellcome and Pfizer. The company said it plans to almost double its sales force.
Dura was the most active stock on U.S. exchanges, with 32.4 million shares traded.
Nike Inc. rose $1.875 to $45. It fell 7.6 percent Tuesday after warning that fiscal third-quarter earnings will be well below expectations. Analyst said the athletic-shoe maker's proposed spending cuts may boost profits.
Cigna Corp. rose $8.9375 to $186.50 after the insurer announced a 4 percent rise in its quarterly dividend and a 3-for-1 stock split.
Yellow Corp. plunged $5.625 to $20.50 after the trucking company said it could report a first-quarter loss because customers sought other shippers to avoid a possible strike by Yellow drivers. Wall Street expected earnings of 39 cents a share.
Pub Date: 2/26/98