Stocks rise for 6th day on strong earnings Nasdaq index soars 35 points

Dow up 13 just from IBM's gain

October 22, 1998|By BLOOMBERG NEWS

NEW YORK -- U.S. stocks rose for a sixth straight day, after Microsoft Corp. and International Business Machines Corp. reported better-than-expected quarterly profits.

"Every major technology company has reported an upside surprise," said Phil Orlando, chief investment officer at Value Line Asset Management, which oversees $6 billion. "The myth that earnings are falling apart is not being substantiated."

The Nasdaq composite index, dominated by computer-related shares, soared 35.56, or 2.2 percent, to 1,674.75. The index has added 18 percent since Oct. 8.

The Dow Jones industrial average rose 13.38, to 8,519.23, its first six-day gain since February. The Standard & Poor's 500 index rose 5.99, to 1,069.92.

Among other broad indexes yesterday, the Russell 2,000 index of small-capitalization stocks rose 1.63, to 359.94; the Wilshire 5,000 index gained 56.46, to 9,720.20; the American Stock Exchange composite index added 4.28, to 620.55; and the S&P 400 midcap index slipped 0.10, to 316.76.

The Sun-Bloomberg Maryland Index, which tracks the top 100 Maryland stocks by market valuation, fell 0.39, to 179.63.

Advancing and declining stocks were almost evenly matched on the New York Stock Exchange. About 745 million shares changed hands, below the three-month daily average of 767 million.

Investors also took comfort in IBM's third-quarter earnings, which rose a better-than-expected 10 percent. IBM gained $4.8125, to $142.6875, accounting for all of the Dow's gain. Dell Computer Corp. was the most active stock in U.S. trading, rising $3.625, to $56.9375, as 39 million shares changed hands.

PeopleSoft Inc., the No. 2 maker of business-management software, tumbled $6, to $19.75, after forecasting that sales will slow next year because of economic turmoil and competition.

Exxon and Amoco, the first of the major U.S. oil companies to report earnings, said third-quarter profit dropped on lower crude prices. Exxon fell $1, to $75.5625, and Amoco declined 56.25 cents, to 52.1875.

Minnesota Mining & Manufacturing Co. fell $2.25, to $84.25, clipping 10 points from the Dow average. The maker of Post-it Notes, which generates half its revenue in foreign markets, is expected to report lower earnings today.

DuPont Co., the largest U.S. chemicals company, said third-quarter profit fell 16 percent because of lower crude oil prices, weak global demand and competition from Asian imports made cheaper by the dollar's strength. DuPont fell $2.1875, to $62.

Pub Date: 10/22/98

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