Wednesday, December 30, 1998

Dow rises for eighth straight session

By BRUCE MEYERSON

Associated Press

NEW YORK -- The Dow industrials rose for an eighth straight session Tuesday for its longest winning streak in two years, moving within 55 points of record-setting finish to 1998.

The Standard & Poor's 500 index and the Nasdaq composite closed at new highs again despite some profit-taking among leading Internet stocks.

The Dow Jones industrial average erased an early 39-point loss and rose 94.23 to 9,320.98, closing fast on the Nov. 23 record of 9,374.27.

The barometer of 30 major companies has now tacked on 530 points in eight sessions, expanding this year's surprising gain to 17.9 percent. The winning streak is the Dow's longest since November 1996, when it posted an eight-session string after President Clinton was re-elected.

With just two session left in 1998, the Dow is on the verge of an unprecedented fourth year in a row with a gain of more than 15 percent, if not its fourth straight with gain of more than 20 percent. Less than three months ago, the Dow was showing a loss for the year, plagued by worries about financial crises overseas. The ensuing rebound was sparked by a series of interest rate cuts by the Federal Reserve.

Volume picked up from Monday's lifeless pace, but trading remained very quiet with many investors taking off for an extended break between Christmas and New Year's.

"The real news is that the market is actually up without the Internet stocks," said Tony Dwyer, chief equity strategist at Ladenburg Thalmann & Co., pointing to year-end portfolio polishing as the main influence behind the market's "Santa Claus" rally.

"There's some big money flow coming into the market because portfolio managers, with another good year in the market, don't want to show too much cash on hand at end of year," Dwyer said, noting recent reports that mutual funds and other major institutions have been holding an unusually large amount of cash.

The most notable decliners Tuesday were Internet issues, although the losses paled in comparison with the big gains racked up by that group.

In Nasdaq trading, Yahoo! fell 5-1/2 to 270 and Amazon.com fell 19-5/8 to 332 5/16 after soaring nearly 30 points each on Monday. America Online gave back a small part of Monday's 20-point gain, falling 2-5/8 to 154-5/8 as the most active issue on the New York Stock Exchange.

The Dow's big gainers were AT&T, up 4-3/8 to 79; Johnson & Johnson, up 3 3/16 to 105; American Express, up 3 1/16 to 105; and Merck, up 3 1/16 to 151 1/16.

The Standard & Poor's 500 rose 16.32 to a record 1,241.81, extending this year's gain to 28.0 percent.

The Nasdaq composite index rose 1.47 to 2,181.77, bobbing higher just before the close to pad Monday's record. For the year, the technology-rich measure is up 38.9 percent.

Advancing issues outnumbered decliners by a 7-to-5 ratio on the New York Stock Exchange, but Nasdaq gainers led by only a slender margin.

NYSE composite volume totaled 753.27 million shares, up from 687.18 million on Monday.

The NYSE composite index rose 8.04 to 597.05, and the American Stock Exchange composite index rose 5.17 to 670.75.

The Russell 2000 index of smaller companies rose 2.13 to 410.41.

In economic news, the Conference Board reported that consumer confidence held steady in December.

The research group's monthly reading had rebounded in November after a four-month slide that was triggered by the turmoil on world markets.

Back then, analysts worried that an erosion in confidence would further strain a domestic economy already weakened by falling demand for U.S. exports. Consumers spending accounts for two-thirds of the nation's overall economic activity.

Overseas, Japan's Nikkei stock average rose 1.0 percent. Germany's DAX index fell 0.3 percent, Britain's FT-SE 100 rose 1.3 percent, and France's CAC-40 rose 0.5 percent.