Dow gains 56 points

Nasdaq adds 26

Greenspan speech buoys those hoping rate increase will be mild at worst

Wall Street

June 18, 1999|By BLOOMBERG NEWS

NEW YORK -- U.S. stocks rose with bonds as a speech by Federal Reserve Chairman Alan Greenspan bolstered confidence that interest rates won't need to rise much to head off inflation.

Banks including Citigroup Inc. and software shares such as Oracle Corp. led the gains.

"Markets are likely to easily tolerate" a Fed rate increase, Goldman Sachs & Co. strategist Abby Joseph Cohen said in a note to clients.

The Dow Jones industrial average rose for a fourth day, climbing 56.68 to 10,841.63; the Standard & Poor's 500 index gained 9.49 to 1,339.90. The Nasdaq composite index added 26.32, or 1.1 percent, to 2,544.15, after soaring 4.3 percent Wednesday.

Russell 2,000 up 2.18

Meanwhile, the Russell 2,000 index, a benchmark of small-cap stocks, rose 2.18 to 443.38; the Wilshire 5,000 index gained 95.83 to 12,240.71; the American Stock Exchange composite index advanced 3.77 to 768.69; and the S&P 400 midcap index rose 2.20 to 408.16, less than 1.5 points from its record.

The Sun-Bloomberg Maryland index of the top 100 Maryland stocks gained 0.49 to 190.37.

Three stocks rose for every two that declined on the New York Stock Exchange, where 700.3 million shares traded.

U.S. bonds staged their biggest rally since March.

The 30-year Treasury bond's yield sank 10 basis points to 5.96 percent, the lowest level in almost two weeks. The decline completed an eight-day round trip that sent yields as high as 6.16 percent Friday and triggered a four-day, 3.8 percent decline in the Dow average.

Citigroup Inc. rose 81.25 cents to $46.9375; Bank One Corp. gained $1.1875 to $56.625; Bank of America Corp., parent of Nationsbank and Bank of America, added 50 cents to $67.50; First Union Corp. jumped $1.5625 to $44.3125; and Wells Fargo Co. advanced $1.3125 to $42.50.

Oracle, the most active stock with 50.6 million shares traded, led software stocks higher. Oracle gained $1.9375, or 6 percent, to $34.875, adding to a 31 percent gain Wednesday after fiscal fourth-quarter profit topped forecasts. Microsoft Corp. rose $1.875 to $82.875 and Computer Sciences Corp. rose $1.375 to $66.875.

AOL rises $4.375

America Online Inc. jumped $4.375 to $110.875; At Home Corp. added $3.9375 to $51.3125; CMGI Inc. gained $3.375 to $96.50; and Yahoo! Inc. advanced 62.5 cents to $142.25. eBay Inc. fell $2 to $146.75.

Intel Corp. fell $1.6875 to $58, leading semiconductor shares lower, after analyst Charles Glavin at Credit Suisse First Boston lowered his earnings forecast on the No. 1 semiconductor maker.

Micron Technology Inc. lost $1.375 to $45.125 and Texas Instruments Inc. slid 6.25 cents to $133.50.

Compaq Computer Corp. gained 31.25 cents to $22.5625 after saying it will restructure to cut $2 billion in costs. The No. 1 personal-computer maker expects a loss of up to 15 cents a share in the second quarter. Compaq has lost more than half its value since late January amid declining PC prices.

Dell up, IBM down

Dell Computer Corp. rose 87.65 cents to $36.50, but International Business Machines Corp. fell 50 cents to $120.1875.

Western Digital Corp., the No. 3 maker of computer disk drives, fell 37.5 cents to $6.50 after saying it expects to lose 90 cents to 98 cents a share this quarter because of price competition in desktop computer drives that has been more fierce than expected.

Bergen Brunswig Corp. fell $4.0625 to $14.8125. The No. 3 U.S. drug wholesaler said a new Medicare-reimbursement program may hurt its earnings more than anticipated.

International Paper Co. fell $2.1875 to $53.3125; Weyerhaeuser Co. lost $2 to $68.9375; Georgia-Pacific Group skidded $1.4375 to $51.25; and Champion International Corp. sank $1.75 to $51.25.

Pub Date: 6/18/99

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