All,
Closing Stock Market Commentary
brought to you by Larry Wachtel.
This commentary, edited for use on the Internet, is
broadcast on New York radio (station WINS, 1010
AM). Please note that securities mentioned within
this commentary should not be considered as
recommendations and are for informational
purposes only.
September 3, 1997, 5:00 p.m. EST
DJIA 7894.64 +14.86
PICTURE
Somebody ought to tell the bull
that September is the worst
month of the market year. After
yesterday's unprecedented
moon shot, some give-back
was not out of the question. Instead, the market
forged ahead although some settling down did
develop in the final 30 minutes.
After gaining as much as 60-points at the peak, the
Dow Jones Industrial Average settled for a 14-point
gain. Advances outpaced declines by a three-to-two
margin while technology oriented NASDAQ eked
out a marginal gain. Volume expanded to 553
million shares.
Stocks continue to benefit from month beginning
investment placements, vacation ending liquidity
flows and from good old Goldilocks. In other words,
the combination of friendly rates, abundant profits
and unrelenting cash flow brought us to the party
remains in effect.
Among the Dow Blue Chips, Allied Signal, United
Technology, Eastman Kodak, Hewlett Packard, and
Caterpillar were point sized winners while Dupont
lost ground.
Technology stocks dominated the headlines.
Gateway 2000 fell three-points after missing the
quarter for a second time. However, other personal
computer stocks held, with Dell up three-points.
Hutchinson Tech, a supplier to the disk drive
industry, lost three-points on a negative
preannouncement. This influenced the disk drive
stocks with Seagate, Quantum, and Western Digital
losing ground. Salomon cut the rating on Seagate.
National Semi led the chip stocks ahead of quarterly
results tomorrow. Intel gave some ground despite an
earnings upgrade by Robertson Stephens.
Disappointing results hurt the shares of Home
Health Corp., Pall Corp. and Carmike Cinema.
On the zeal to deal, Zytec rose seven points after
agreeing to a merger with computer products while
Versa Technology rose over two points. The
company agreed to be acquired by Applied Power
Co. Finally, Mid Continent gained six points on a
deal with Commercial Federal.
Bonds fell amid continued mixed economic signals.
Today the Commerce Department said that
construction spending rose in July for the second
month in a row, climbing 0.5%. Further, the New
York based Conference Board said its index of
leading economic indicators rose at the fastest rate
in five months in July, the best showing since
February. Treasury bonds lost some ground with the
long-bond yield rising two basis point to 6.58%.
The dollar fell against the mark after an unexpected
surge in German Industrial Production fanned
speculation the Bundesbank may raise rates.
Moreover, the Bundesbank President, Hans
Tietmeyer implied he would not like to see further
mark weakness.
Given the final half hour fade, we might see some
settling back tomorrow ahead of Fridays job figures.
However, the bull has signaled he is far from
pooped.
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Ibexx |
