FINANCIAL MARKETS : Dow Gains 14.52, Passing 4,500 Barrier
Blue-chip stocks closed above 4,500 for the first time Friday as the “triple witching” quarterly options and futures expirations helped send the market to its third straight record close.
After rising to 4,517.02 earlier in the day, the Dow Jones industrial average ended 14.52 points higher at a record 4,510.79, surpassing Thursday’s record of 4,496.27. That capped a week of gains that boosted the Dow nearly 87 points.
Big Board volume was heavy at 448.3 million shares, the highest this year and the sixth-heaviest ever. Volume swelled as traders closed out positions related to the quarterly simultaneous expiration of stock options, index options and index futures.
But while most major stock indexes joined the Dow at record highs, advancing issues barely edged losers on the NYSE.
Stocks got early support from University of Michigan data showing a rise in a key consumer sentiment index for June, to 92.3, rather than a predicted 89.6, from 89.8 in May.
That dampened some investors’ worries that a recession is looming.
“The [Michigan] numbers tell us that the economy is not going to go into a tailspin,” said Hugh Johnson, First Albany Corp.’s strategist.
But the bond market, which has been hoping for weaker economic reports that might push the Federal Reserve Board to reduce short-term interest rates, showed disappointment at the consumer sentiment index.
Treasury bond yields rose slightly in a quiet finish to a volatile week. The benchmark 30-year T-bond yield edged up to 6.62% from 6.61% on Thursday. The yield had fallen as low as 6.55% on Tuesday.
Among Friday’s highlights:
* Many telecommunications stocks advanced sharply in the wake of the Senate’s passage Thursday of a telecommunications deregulation bill.
Winners included Clear Channel, up 4 5/8 to 69; Infinity Broadcasting, up 2 1/8 to 36 5/8; Capital Cities/ABC, up 3 1/4 to 106; Time Warner, up 1 1/2 to 40 5/8; Comcast, up 13/16 to 18 5/8; Tele-Communications A, up 5/8 to 23 1/8; Nokia, up 6 to 54 1/2, and General Instrument, up 3 5/8 to 37 1/8.
Among phone utilities, BellAtlantic rose 1 1/2 to 57 and Ameritech jumped 7/8 to 46 1/4. But Pacific Telesis eased 1/4 to 26 1/8.
* Some technology issues showed impressive strength.
Microsoft rose 2 1/8 to 87 after a federal appeals court upheld the Justice Department’s antitrust settlement with the software giant.
Other gainers included Hewlett-Packard, up 2 7/8 to 75 1/2; Seagate, up 1 3/8 to 41 3/8, and Exabyte, up 1/2 to 14 3/4.
* Classic consumer growth stocks surged anew.
Consumer issues rising included Tambrands, up 3/4 to 41 3/4; Duracell, up 1 1/8 to 43 7/8; Philip Morris, up 1 to 73 3/4; Coca-Cola, up 1 to 62 3/8, and Kellogg, up 2 3/4 to 72.
* Caremark International rose 1 7/8 to 21 7/8. The health care company reportedly agreed to plead guilty in a federal kickback investigation and pay about $159 million in civil damages and criminal fines.
* On the downside, Home Depot fell 1 3/4 to 40 5/8 in heavy trading after Bear Stearns and Prudential Securities cut their second-quarter earnings estimates for the firm.
Foreign markets were mixed. Mexican stocks rose for a fifth day, with the Bolsa index gaining 45.73 points to 2,041.89.
Stocks closed lower in Frankfurt, Tokyo and London.
Market Roundup, D3
