Late rally by banks helps pare losses Broad indexes follow Dow, Nasdaq down

some hit new lows

Wall Street

October 09, 1998|By BLOOMBERG NEWS

NEW YORK -- Broad indexes followed the Dow Jones industrial average and Nasdaq composite index downward yesterday, but a late-day rally by bank and brokerage shares pared the losses.

The Russell 2,000 index of small-capitalization stocks tumbled 11.95, to 310.28. The index has fallen 17.5 percent in 11 straight days of losses.

The Wilshire 5,000 index fell for the eighth straight day, losing 171.40, to 8,620.80; the American Stock Exchange composite index skidded 22.02, to 563.75, its low this year; and the S&P 400 midcap index fell 9.38, to 275.93, another low for the year.

Tracking the top 100 Maryland stocks by market valuation, the Sun-Bloomberg Maryland index fell 5.56, to 162.02. It is down 10.26 percent this week.

Among financial stocks, J. P. Morgan & Co. surged $5.5625 to $80.0625 to aid the Dow, which ended down 9.78 to 7,731.91.

Merrill Lynch & Co. gained $5 to $42.75; Lehman Brothers Holdings Inc. rose $4.6875 to $29.4375; Morgan Stanley, Dean Witter & Co. climbed $2.9375 to $41.375; and Bankers Trust Corp. jumped $5.3125 to $54.50.

Still, almost five shares fell for every one that rose on the Big Board. Software and computer shares, two of the engines of the bull market, led decliners.

Microsoft Corp. continued to lead the Nasdaq downward, falling $2.9375 to $91.1875.

Dell Computer Corp. slumped $2.125 to $48.4375, as 102 million shares changed hands, compared with average daily volume of 40 million for the past three months.

Computer Associates International Inc. dropped $1.6875 to $31.4375, and Oracle Corp. fell 50 cents to $23.875.

Cisco Systems Inc., the one bright spot among high-tech leaders, gained $2.8125 to $46.6875, logging its first gain in nine days.

General Electric Co. fell $3.4375 to $71.5625 on slower-than-expected sales after delays in shipments of power-generating equipment. The company's third- quarter profit rose 13 percent, matching analysts' expectations.

Yahoo! Inc. fell $9.5625 to $104.8125 on concern that growth of established Internet companies may slow as they face more competition.

The No. 1 Internet directory said late Wednesday that third-quarter profit surged to $16.7 million, or 15 cents a diluted share, from $681,000, or 1 cent, a year earlier. Revenue more than tripled from advertising and electronic-commerce agreements. Analysts expected 9 cents a share.

Yahoo!, whose shares have gained 230 percent this year, sells at 317 times this year's estimated earnings per share.

Merrill Lynch & Co. analysts Candace Browning-Platt and Michael Linenberg cut their 1999 earnings estimates on nine airline stocks, including UAL Corp.'s United Airlines, American Airlines parent AMR Corp., and Delta Airlines Inc. UAL fell $1.8125 to $58.9375; AMR dropped $3.8125 to $47.125; and Delta skidded $5.625 to $82.6875.

Procter & Gamble Co., the largest U.S. maker of consumer goods, rose $1.25 to $78.625.

Coca-Cola Co. rose $1.1875 to $64.50.

The dollar extended yesterday's 9-yen rout against the Japanese currency to trade at 119.45 yen. A weaker dollar means these companies bring home more cash from the money they earn abroad.

Raytheon Co., the world's third-largest aerospace company, fell $1 to $57 after it said third-quarter earnings will be "slightly below" analyst expectations of 90 cents a share. Raytheon said it will cut 5,300 more defense jobs as it struggles to pare costs after last year's acquisition binge.

Agco Corp., an agricultural-equipment maker, fell 56.25 cents to $5.75 after it said 1998 earnings could be as much as 45 percent lower than last year on reduced global demand for its tractors and other products.

Information Resources Inc., a provider of information services to the packaged goods industry, dropped $5.5625 to $6.9375 after it said third- and fourth-quarter earnings will be below analyst estimates, owing to lower-than-expected domestic revenue.

Pub Date: 10/09/98

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