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Wednesday, Jul. 15, 1998
Dow zooms to record high of 9,245.54
Shakeup in Japan spurs hope for improved economy in Asia
Associated Press
NEW YORK - The Dow industrials jumped nearly 150 points to reach a new high Tuesday, fueled by strong profit reports and hopes that Japan's political upheaval will mean a swifter recovery in Asia.
The Dow Jones industrial average rose 149.33 to close at 9,245.54, setting its first new high in two months and extending this year's surprising gain to 16.9 percent. The previous record close of 9,211.84 was set May 13.
The barometer of 30 well-known companies rose as high as 9,256.61 during the session, missing May 4's all-time intraday high of 9,261.91 by about 5 points.
Broader stock indicators also set records as J.P. Morgan surged 7 9/16 - or the equivalent of 30 Dow points - to 133 9/16 after topping Wall Street forecasts with a second-quarter profit of $481 million, up 29 percent from last year's April-June period.
Johnson & Johnson, another Dow component, rose 2 7/16 to 74 after the medical product company's quarterly profit of $1 billion matched most projections.
But while the latest news on the quarter that just ended accounted for a big chunk of the Dow's gain, analysts also pointed to a sudden improvement in sentiment about the future thanks to Sunday's election upset in Japan.
With Prime Minister Ryutaro Hashimoto quitting after his party's anemic showing, hopes were high that his replacement will implement tax cuts and other concrete measures to end Japan's recession and jump-start the Asian sickly economy.
``The market's getting new life from the idea that Japan may be on the road to recovery, that the election revealed a mandate for change,'' said A.C. Moore, chief investment strategist for Dunvegan Associates in Santa Barbara, Calif.
It has been feared that a deepening of Japan's recession would drag down recovery efforts throughout Asia and bring the full force of the Asian crisis onto U.S. shores.
The Standard & Poor's 500 index, the most popular yardstick for comparing mutual funds that invest in stocks, rose 12.39 to 1,177.58, blowing past last Wednesday's closing record of 1,166.38 and lifting 1998's gain to 21.3 percent.
The red-hot Nasdaq market set a new high for the fifth session in a row, but lagged Tuesday's advance as the rally among leading technology names stalled after several days of big gains.
The Nasdaq composite index, which on Monday pushed this year's gain above 25 percent, rose just 2.88 to 1,968.41.
Advancing issues outnumbered decliners by a 7-to-5 margin on the New York Stock Exchange, where volume totaled a hefty 853.59 million shares, up from 701.06 million on Monday.
The NYSE composite index rose 6.19 to 597.61, topping last Wednesday's record of 594.35, and the American Stock Exchange composite index 1.73 to 732.20.
With the continuing emphasis on company profits and Asia, there was little notice paid to a report offering the latest evidence of a resilient U.S. economy that continues to grow without inflation.
The government's Consumer Price Index edged a scant 0.1 percent higher last month after rising a moderate 0.3 percent in May, the most in a year and a half.
For the first half of the year, inflation ran at a 1.4 percent annual rate, compared with an 11-year low of 1.7 percent for all of last year, the Labor Department said.Post your comments about local news eventsFront Page || Main Index || News || Business || Texas || South Texas Outdoors || Birdwatching || Sports || Entertainment || Selena || Education || South Texas Attractions || World Wide Web