You Can Take Heart From the January Gain, or You Can Punt

The stock market’s gain in January suggests 1993 will be an up year for Wall Street--unless, of course, the Buffalo Bills won the Super Bowl.

In market lore, two predictors of performance have won special places in traders’ hearts:

* The “January barometer” holds that the market will rise for the year if the Standard & Poor’s 500 index rises in January, or fall for the year (or close flat) if the S & P is a loser in January.

Yale Hirsch, an Old Tappan, N. J.-based market historian, says that since 1950 the barometer has erred significantly in only four years. Unfortunately for the barometer’s image, one of those years was 1992, when the S & P fell 2% in January but still closed up 4.5% for the year. (The other big January fakeouts: ‘66, ’68 and ’82.)

* The Super Bowl indicator calls for an up market year whenever the National Football Conference team wins. A win by the American Football Conference team, in contrast, has generally heralded a down year. The accuracy rate on this one: 88% in 26 years.

(This story was printed before the game ended Sunday; if Buffalo won, don’t be shocked if your broker is in a lousy mood.)

Does Wall Street really pay attention to these barometers? No one has ever quite explained the Super Bowl indicator’s accuracy, but the January barometer makes sense, Hirsch says: As the new year begins--especially when a new President and new Congress take power--”Wall Street has a chance to size up the situation and vote which way it wants to go.”

* January Market Roundup A strong advance in transportation stocks and small-company stocks powered the market higher in January, a reflection of investors’ optimism about the economy. While the Dow industrials lagged, they came on strong in the last week.

1992 January Pct. Index close close change Dow transports 1,449.21 1,506.42 +3.9% Amex market value 399.23 411.08 +3.0% NASDAQ composite 676.95 696.34 +2.9% Dow utilities 221.02 226.59 +2.5% S&P; midcap 160.56 162.35 +1.1% NYSE composite 240.21 241.92 +0.7% S&P; 500 435.71 438.78 +0.7% Dow industrials 3,301.11 3,310.03 +0.3%