Record Highs Cap an Exceptionally Strong Week on Wall Street

Stocks rose to new records Friday as a strong employment report fed investors’ enthusiasm and capped a week of extraordinary strength on Wall Street.

The Dow Jones industrial average rose 72.82 points to close at 11,139.24, topping its previous record close of 11,107.19, set May 13.

“We got exactly what we were hoping for out of the Fed on Wednesday, and this morning’s data didn’t deter us from a summer rally,” said Philip Orlando, chief investment officer for Value Line Asset Management. “Anyone predicting a summer correction is looking for another job.”

All three major indexes had their biggest weekly point gains ever. The Dow added 586.68 points, or 5.6%--its best week since last fall. The Standard & Poor’s 500 gained 75.91, or 5.8%, on the week, while the Nasdaq composite soared 188.37 points, or 7.4%. In percentage terms, it was Nasdaq’s seventh-biggest gain ever, though it wasn’t in the top 10 for the Dow or the S&P; 500.

Broad stock indicators extended a string of records Friday. The S&P; 500 rose 10.26 points to close at 1,391.22, and Nasdaq rose 34.84 points to 2,741.02.

Stocks climbed as the Labor Department said American businesses created 268,000 new jobs in June, with all industries except manufacturing and mining posting solid gains. The rise was slightly stronger than economists expected, and average hourly earnings increased by 3.7% in June compared with a year ago.

In a less buoyant market, the report might have punctured investors’ zest for stocks. Higher wages can crimp earnings because labor costs account for most of consumer prices. They also raise the specter of another increase in interest rates after this week’s modest hike by Federal Reserve policymakers.

But the bond market, which often sets the tone for stocks, was unmoved by the jump in wages. The yield on the benchmark 30-year Treasury bond held steady at 6.00%.

Cyclical stocks, which perform best during times of economic expansion, rose broadly. International Paper gained $1.25 to $51, and 3M climbed $1.69 to $88.88.

Financial stocks continued to gain strength from the interest rate environment. American Express, up $4.63 to $137.75, was the strongest Dow component.

Leading tech stocks fueled Nasdaq’s gain, with Cisco Systems gaining $2.69 to $67.06 and Sun Microsystems rising $1.88 to $70.06. Internet companies were almost uniformly higher, with search engine company Infoseek jumping $5.50 to $55.88.

Advancing issues outnumbered decliners by 11 to 8 on the New York Stock Exchange.

Heading into the three-day Independence Day weekend, volume was weak. U.S. markets will be closed Monday in observance of the holiday, and many traders took Friday off as well.

The NYSE composite index rose 3.79 points to 655.12, while the Russell 2,000 index of smaller companies rose 2.09 points to 456.51.

Among the highlights:

* Mirage Resorts dropped $1.50 to $15.25 as the Las Vegas-based casino hotel company warned it expects second-quarter earnings of 7 to 10 cents a share, below analysts’ estimates and year-ago levels.

* GoTo.com extended its tear by leaping $13.94 to $50.44 as Netscape Communications said it will include a link to the Pasadena company’s Web site in an upgraded version of its search service.

* Day Runner tumbled $2.63 to $10 after the Irvine maker of paper organizers said it expects to lose money in its fiscal fourth quarter.

* RealNetworks surged $12.06 to $89.94 after the maker of software used to access audio and video online said its software will be used in Microsoft’s WebTV and Windows CE products.

Market Roundup, C4

(BEGIN TEXT OF INFOBOX / INFOGRAPHIC)

Weekly Winners

Among the stocks hitting new highs this week on the New York Stock Exchange:

*--*

Company Friday close 1-week % change Best Buy $73.00 +15.1% MBNA 31.94 +14.1 Tiffany 97.25 +12.0 Nokia 94.56 +10.9 Univision 66.00 +10.9 Motorola 98.31 +9.2 Tyco Intl. 98.75 +8.5 Sony 112.75 +8.2 IBM 132.25 +7.4 W.R. Grace 19.38 +7.3

*--*

Sources: Times research, Bloomberg News

IPO Tally

Initial public offerings raised a near-record $24.8 billion nationwide in the year’s first half, according to Thomson Financial Securities Data. The 225 deals were nowhere near the high mark set in 1996’s first half, however. Half year volume and deal number totals since 1989:

Proceeds

First-half 1999: $24.8 billion

*

Number of deals

First-half 1999: 225

Source: Thomson Financial Securities Data

COMING MONDAY: California Dealin’ features a special midyear report on the state’s IPO market.