Computer shares lead first rise in 3 days Dow gains 1.3% but is 300 behind record set July 17

July 31, 1998|By BLOOMBERG NEWS

NEW YORK -- U.S. stocks rose yesterday for the first time in three days, led by computer shares.

The Standard & Poor's 500 index staged its biggest rally in six weeks, gaining 17.65, or 1.6 percent, to 1,142.86.

Lucent Technologies Inc., which had slid 13 percent from its July 20 high, led the gains, rising $6.25 -- nearly 7 percent -- to $95.25.

Compaq Computer Corp. rose $2.9375 to $34 in trading of 26 million shares and was the most actively traded stock in U.S. markets.

The Dow Jones industrial average rose 111.99, or 1.3 percent, to 9,026.95, though it is still off its July 17 record by about 300 points. International Business Machines Corp. rose for a second day, up $5.625 to $133.375, leading the Dow industrials higher.

The Nasdaq composite index climbed 38.13, or 2 percent, to 1,919.62, aided by Microsoft Corp., which rose $2.75 to $113.4375; Dell Computer Corp., up $5.375 to $112.75; and Intel Corp., up $3 to $87.625.

Among other broad indexes, the Russell 2,000 index of small capitalization stocks rose 3.31 to 429.50; the Wilshire 5,000 index gained 152.73 to 10,622.17; the American Stock Exchange composite index gained 5.61 to 713.47; and the S&P 400 midcap index added 6.38 to 352.45.

The Sun-Bloomberg Maryland index, which tracks the top 100 Maryland stocks by market valuation, gained .77 to 219.48.

More stocks rose than fell on the New York Stock Exchange yesterday for the first time in two weeks. About two stocks rose for every one that fell. Only 105 companies in the broad market reached 52-week highs and 431 fell to 52-week lows. About 682 million shares changed hands, 12 percent above the three-month daily average.

Advanced Micro Devices jumped $1.5625 to $17.25 after it said it would be profitable in the fourth quarter. AMD sells a microprocessor, the K6, which competes with Intel Corp.'s Pentium chips. The company has lost money for the last four quarters.

Clorox Co. soared $8.375 to $103.125 after the seventh-biggest U.S. maker of consumer products reported a better-than-expected 32 percent gain in fiscal fourth-quarter earnings. Shares of the Oakland, Calif., company have tripled in five years.

Tommy Hilfiger Corp., an apparel company that was down 24 percent Wednesday from its June 4 high, rose $4.6875, or 9 percent, to $56.6875 yesterday.

Stocks benefited from a government report that labor costs for ++ U.S. businesses were in line with expectations in the second quarter, and news that home sales rose at a record pace in June.

The yield on the 30-year Treasury bond, a benchmark for borrowing costs, fell to 5.72 percent from 5.76 percent Wednesday.

BetzDearborn Inc. rose $31.8125 to $67.6875 after Hercules Inc. agreed to acquire it for $3.1 billion in cash and assumed debt. The combination of BetzDearborn and Hercules will create one of the world's biggest paper-chemicals companies. Nalco Chemical Co., another specialty chemicals company, rose $2.875 to $34.9375.

Washington Mutual Inc. fell $1.5313 to $39.2813 and H. F. Ahmanson & Co. fell $1.9375 to $65.50 amid concern that earnings for Washington Mutual, America's largest thrift, might decline because of mortgage refinancings and lower cost savings from mergers. Washington Mutual agreed to acquire H. F. Ahmanson in March.

Drug stocks climbed after Glaxo Wellcome PLC, the world's second-largest drug maker, reported unexpectedly strong earnings. Glaxo's American depositary receipts soared $5.75 to $62.375.

Procter & Gamble Co., the top U.S. maker of consumer products, was the biggest decliner in the Dow average. It dropped $4.50 to $83.625 after warning that earnings in the first half of next year could be hurt by weakness in Asia and price competition. It reported a 12 percent gain in fourth-quarter earnings.

Pub Date: 7/31/98

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