Stocks mixed, Dow up 80 points S&P 500 also rises, but Nasdaq falls 4.37 after early-session surge

Wall Street

September 29, 1998|By BLOOMBERG NEWS

NEW YORK -- U.S. stocks were mixed yesterday on concern that share prices already reflect the benefits of the Federal Reserve interest-rate cut that is expected today.

The Dow Jones industrial average rose 80.07, to 8,108.84. The Standard & Poor's 500 index gained 3.94, to 1,048.69. The Nasdaq composite index dropped 4.37, to 1,739.22, retreating from a 25.98-point advance.

Among other broad indexes, the Russell 2,000 index of small-capitalization stocks lost 1.01, to 368.01; the Wilshire 5,000 index gained 27.96, to 9,603.94; the American Stock Exchange composite index eased up 0.13, to 640.12; and the S&P 400 midcap index added 2.33, to 314.84.

The Sun-Bloomberg Maryland index, which tracks the top 100 Maryland stocks by market valuation, slipped 0.39, to 186.40.

Advancing stocks outnumbered decliners by a 17-to-13 ratio on the New York Stock Exchange.

Banks and financial firms surrendered early gains. Morgan Stanley Dean Witter & Co. dropped $3.375, to $49.25, and Lehman Brothers Holding Inc. tumbled $2.25, to $31, on concern that more firms will disclose losses related to last week's near-collapse of the Long-Term Capital Management LP hedge fund. So far, UBS AG, Dresdner Bank AG, Credit Suisse Group and Chinatrust Commercial Bank have warned of losses on Long-Term Capital.

Chase Manhattan Corp., one of the banks involved in Long-Term Capital's rescue, dropped 93.75 cents, to $44.5625, yesterday, losing a $3.3125 gain.

Procter & Gamble Co., which lost 29 percent of its value in the past three months as Asia's slump clouded its earnings outlook, rose $3.125, to $73.625. Colgate-Palmolive Co., which lost 32 percent, jumped $3.375, to $72.8125.

Gillette Co., which lost 42 percent since mid-July, rose $1.6875, to 40. After the market closed, Gillette said it would close 14 factories, cut 4,700 jobs and take a third-quarter charge of $350 million, or 30 cents a share.

America Online Inc., the No. 1 online service, climbed $2.375, to $117.125; Yahoo! Inc. soared $6.9375, to $127.9375; RealNetworks jumped $7.875, to $41.25; and Inc. rose $6.375, to $115.625.

Dell Computer Corp. rose $2, to $68.0625, after analyst Kimberly Alexy at Lehman Brothers Inc. said the biggest direct-seller of personal computers remains the favorite PC stock.

McDonald's Corp. jumped $2.625, to $59.875, after the world's biggest restaurant company said it expects to meet third-quarter earnings expectations and boosted its buyback program to $3.5 billion from $2 billion.

DuPont Co. rose $2.875, to $61.625, after saying it would proceed with plans to sell 20 percent of its Conoco Inc. oil unit.

American Express Co., one of the 30 Dow industrial stocks, gained $2.50, to $83, after it announced that it would buy back 9 percent of its outstanding 456.9 million shares over the next two to three years, in addition to a previously announced buyback program of 100 million shares.

P&G, McDonald's, DuPont and American Express together accounted for 57 percent of the Dow's gain.

Galoob Toys Inc. rose $3.4375, to $11.4375, after Hasbro Inc. said it agreed to buy the maker of Star Wars figures and Spice Girls dolls for $220 million, or $12 a share.

Hasbro also warned that second-half earnings will fall short of expectations because of the Galoob acquisition and store closings by retailer Toys 'R' Us Inc. Hasbro fell $1, to $30.

Access Health Inc. gained $3.8125, to $35.0625, after HBO & Co., the biggest U.S. maker of software for health care companies, said it will pay as much as $1.07 billion in stock to buy the maker of computer programs for doctors. HBO gained $1.0625, to $29.25.

PCD Inc., a maker of electronic connectors, fell $2.375, to $11.75, extending Friday's 7 percent decline, after warning that third-quarter earnings will be below analysts' expectations. The company expects earnings of 17 cents to 19 cents a diluted share, down from 26 cents a year earlier.

United Asset Management Inc. gained 68.75 cents, to $23.125, after saying it is in talks with Nationwide Financial Services Inc. to sell its Pilgrim Baxter & Associates unit, which manages the PBHG funds, for $600 million.

Pub Date: 9/29/98

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