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Friday, Jul. 17, 1998
Big caps lift indexes to records
Dow, Nasdaq, S&P 500, NYSE composite all achieve new highs
Associated Press
NEW YORK - Stocks bounded to record levels Thursday - with the Dow industrials convincingly clearing 9,300 and the Nasdaq index squeaking above 2,000 - as corporations served up a fresh round of strong corporate profits and a surge in technology shares pulled Wall Street out of an early slump.
The Dow Jones industrial average rose 93.72 to 9,328.19, closing above 9,300 for the first time and topping the previous record of 9,245.54, which was set Tuesday.
The technology-heavy Nasdaq composite index rallied to its seventh straight record, adding 6.02 points to close at 2,000.56.
The Standard & Poor's 500 index and the NYSE composite index were also at record highs, with the S&P closing at 1,183.99, up 9.18, and the NYSE composite closing at 599.99, up 4.50. The American Stock Exchange's market index rose 1.42 to 731.81.
Including Thursday's gains, the Dow is up almost 19 percent this year, while the Nasdaq has gained more than 27 percent, well above the modest forecasts as 1998 began.
Composite volume was 816 million shares on the New York Stock Exchange, up from 722 million on Wednesday.
The market is doing well because corporations are coming through with unexpectedly strong earnings, said Hugh Johnson, chief market strategist at First Albany Corp.
Lack of confidence in the Asian markets, which had dogged the market for some time, is turning a corner as well, Johnson said, removing the last major obstacle to stocks' reaching higher.
``It's hard to find anything wrong with the current picture,'' Johnson said.
But Larry Wachtel, a market strategist at Prudential Securities, did find something wrong, namely that the market's gains are highly concentrated in big stocks.
``This is a big-cap extravaganza,'' he said. ``The broader market is not participating. It's all wonderful and everything, but if you look at the representative advances and declines every day, they're not as sparkling.''
On the Big Board Thursday, advances led declines by 7 to 5.
Stocks opened lower in an early bout of profit-taking from investors looking to cash in on Wall Street's recent record gains.
But strong earnings reports from Apple Computer, Tellabs, Bowater, Hasbro and Ameritech, plus a rally in technology stocks, erased the losses by early afternoon.
While many investors believed that Asia's financial crisis would hurt earnings in the second quarter, a number of earnings reports this week have beat expectations.
Among the biggest surprises was Apple, which reported after the close of trading Wednesday its third straight money-making quarter. The computer maker earned 65 cents a diluted share in the April-June quarter, far outstripping analysts' expectations of 33 cents per share.
And Microsoft Corp., setting the stage for a market advance on Friday, reported strong earnings after the market closed.
Microsoft, the world's largest maker of desktop operating software, said that in the quarter ended June 30 it earned $1.36 billion, or 50 cents per share on a diluted basis. That was up from $1.06 billion, or 40 cents a diluted share, a year ago. Revenue rose to $4 billion from $3.18 billion.
Microsoft stock closed unchanged at 117.
Overseas, Tokyo's Nikkei stock average rose 0.7 percent, Frankfurt's DAX index fell 0.3 percent and London's FT-SE 100 fell 0.6 percent.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