Path: bloom-picayune.mit.edu!snorkelwacker.mit.edu!news.media.mit.edu!americast.com!usa-post Newsgroups: usa-today.banks From: usa-post@AmeriCast.Com Organization: American Cybercasting Approved: usa-post@AmeriCast.com Subject: banks Tue, Mar 3 1992 Date: Tue, 3 Mar 92 06:00:08 EST Message-ID: 03-03 0000 DECISIONLINE: Banking & Economy USA TODAY Update March 3, 1992 Source: USA TODAY:Gannett National Information Network NAPM INDEX RISES: The National Association of Purchasing Management reported Monday that its purchasing manager's index jumped to 52.4% in February, from 47.4% in January. A reading above 50% indicates manufacturing activity is increasing. A reading above 44.5% indicates a growing economy. The index - based on a survey of purchasing executives - has been in excess of that since May. CONSTRUCTION SPENDING UP: Construction spending jumped 1.3% in January from December to a seasonally adjusted annual rate of $404.1 billion, the Commerce Department said Monday. Spending had dropped for the past three months, with a 1.6% drop in December. Residential construction spending rose 2.6%, single-family spending rose 1.1%, apartments rose 6.0%, and non-residential spending fell 0.7%. SPENDING HAS SLIM GAIN: The Commerce Department reported Monday that consumer spending, which accounts for two-thirds of economic activity, grew more slowly in January, rising only 0.2% after gaining 0.5% in November and December. Personal income lost 0.1% in January after a 1% rise the previous month. Analysts say slow spending is not surprising due to uncertainty about an economic recovery. STOCKS START WEEK HIGHER: Strong economic news Monday lifted stocks in a late burst. Traders pushed stocks higher on hopes that a recovery will come soon and mean higher corporate earnings. The Dow Jones industrial average gained 7.60 points to 3275.27. Other indexes were mostly higher. Rising stocks beat losers 907 to 806 on the New York Stock Exchange, where volume was 180.67 million shares. BUSH HAS PLAN: President Bush apparently has an alternative strategy if the Democrat-controlled Congress does not pass a plan for economic stimulation by his March 20 deadline. Instead of pressing to cut the capital gains tax rate, the White House is actively considering a plan to exempt from taxes capital gains profits realized because of inflation, federal budget director Richard Darman said Monday. MORE FIRMS INCREASES DIVIDENDS: Standard & Poor's said Monday that more companies increased dividends last month vs. February 1991 - a sign of economic optimism. Last month, there were 129 dividend increases vs. 101 a year earlier. Also, there were only 23 dividend reductions and omissions vs. 47 a year earlier. So far this year, dividend increases are up 19% and dividend cuts and omissions are down 55%. WORLD ECONOMIES SLUGGISH: Foreign economies are expected to see little growth in 1992, which will hurt the U.S. economy due to reduced exports. This year, economies of five of the seven largest industrialized nations are expected to grow 2% or less after inflation. Next year, only three are expected to show growth of 3% or more, according to a survey of 50 international economists by newsletter Globescope. HOMES MORE AFFORDABLE: Homes were more affordable in January than anytime in the past 18 years, the National Association of Realtors said Monday. The NAR's housing affordability index rose to 124.7 from 123.8 in December. That means a family earning the national median income of $36,742 had 124.7% of the income needed for a conventional loan on a $102,300 home, the median price of existing homes. TRADE DEFICIT FALLS: The U.S. trade deficit on a balance of payments basis fell to $73.6 billion last year, nearly one-third below 1990's $108.1 billion deficit, the Commerce Department said Monday. Analysts say the deficit is likely to grow again as the economy improves and demand for imports increases. DISCOUNT RATE RISES: The Treasury Department sold $11.4 billion in three-month bills at an average discount rate of 4.02%, up from 3.96% last week. Another $11.4 billion was sold in six-month bills at an average discount rate of 4.10%, up from 4.08% last week. OTS WANTS $275M FROM LAW FIRM: The Office of Thrift Supervision Monday accused law firm Kaye, Scholer, Fierman, Hays & Handler of deliberately misleading federal regulators and demanded $275 million from the firm. The OTS charges that the firm deliberately misled regulators about wrongdoing and financial problems at Charles Keating's failed Lincoln Savings and Loan in Irvine, California. OIL PRICES DOWN: Oil futures prices fell Monday in slow trading. Light sweet crude oil for delivery in April settled at $18.34 per barrel, down 34 cents, at the New York Mercantile Exchange. Lower-grade sour crude for delivery in May settled at $15.75 per barrel, down 30 cents. Home heating oil for delivery in April settled at 50.20 cents a gallon, down 1.38 cents. DOW JONES OPENS ON UPSWING: The Dow Jones average of 30 industrials opens Tuesday at 3275.27, after closing up 7.60 Monday. The New York Stock Exchange composite opens at 228.20, down 0.01. The American Stock Exchange market value opens at 416.79, up 0.70. The NASDAQ OTC composite opens at 635.47, up 2.00. DOLLAR OPENS MOSTLY UP: The dollar opens mixed on foreign markets Tuesday. It opens at 0.5709 British pounds, up from 0.5688; 5.5617 French francs, unchanged; 129.68 Japanese yen, up from 128.80; and 1.6430 German marks, up from 1.6340. (As of 3 p.m. Monday. Source: First American Bank of New York.) 24-HOUR TELEPHONE INFORMATION: USA TODAY Money Hot Line. 95 cents a minute. 1-900-555-5555. Banking & Economy Editor: Jason P. Smith. (919-855-3491) Making copies of USA TODAY Update (Copyright, 1992) for further distribution violates federal law. This article is copyright 1992 Gannett News Service. Redistribution to other sites is not permitted except by arrangement with American Cybercasting Corporation. For more information, send-email to usa@AmeriCast.COM