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 Mon, Mar 30 1992 Date: Mon, 30 Mar 92 05:43:33 EST Message-ID: 03-30 0000 DECISIONLINE: Banking & Economy USA TODAY Update March 30, 1992 Source: USA TODAY:Gannett National Information Network REPORTS SHOULD SHOW RECOVERY: Economists say reports due this week should indicate consistently that a recovery has begun. When the reports are all in, it should be clear "we have entered a recovery" - even if it's a weak one, says Allen Sinai, economist at Boston Co. Economic Advisors. Reports this week should be in line with good news Friday from the Commerce Department on spending and personal income. (For more, see special Reports package below.) INCOMES, SPENDING INCREASE: Personal incomes increased 1.1% in February, the biggest leap in three years, the government said Friday. The gain helped support a 0.9% increase in consumer spending. Consumer spending also jumped 0.9% in January and February, the sharpest gains since back-to-back advances in February and March last year, the Commerce Department said. BRADY URGES LOWER RATES: With signs that a recovery is blooming, Treasury Secretary Nicholas Brady urged the Federal Reserve to lower short-term interest rates and keep the money supply high enough to keep a recovery on track. Brady, on ABC's "Business World" program Sunday, said the Fed made a mistake when it allowed money-supply growth to slow as a recovery was starting last summer. MORTGAGE RATES DROP: Fixed mortgage rates fell last week for the first time in nearly two months, reports the Federal Home Loan Mortgage Corp. Fixed 30-year rates averaged 8.98%, vs. 9.03% a week earlier. One-year adjustable rates averaged 6.19%, vs. 6.22%. RECORDS SET IN FIRST QUARTER: The first quarter, which ends in two days, has been a record-setting quarter for stock markets. The Dow Jones industrial average has set 14 records. And with two days to go, first-quarter average daily volume on the New York Stock Exchange is a record 219.3 million shares. The previous record was 212.7 million the last quarter of 1987. TOKYO SLUMP HURTS USA: The slump in Tokyo's stock market may be dragging down the U.S. market. Japan's Nikkei index has dipped lately, falling below 20,000 for the first time in five years two weeks ago. Friday, the Nikkei fell 248.50 points or 1.3% to 19,636.99, blamed by some as one reason for the Dow's 36-point slide. "I think it will dampen the tone in U.S. markets," economist Maria Ramirez says. STOCK INDEXES STUCK: Despite record volume and 14 new highs for the Dow, the first quarter has not been a good one for stock indexes. For the quarter, which has two days left: The Dow, which fell 36.23 points to 3231.44 Friday, is up only 1.5%; the Standard & Poor's 500 is down 3.3% this year; the NASDAQ composite index, which tracks the hottest segment of the market - small stocks - is up 3.1%. LESS TIME ASKED FOR: Michael Milken's lawyers asked a judge to reduce the jailed financier's sentence, citing Milken's cooperation with investigators and his agreement to testify against former colleague, Alan Rosenthal, in May. Milken was sentenced to 10 years after pleading guilty to six securities-related felonies committed as head of the junk bond department at Drexel Burnham Lambert. SPECIAL PACKAGE ON REPORTS: REPORTS SHOULD BE STRONG: Economic reports out Monday and Tuesday are expected to show growth. Monday - new home sales, estimated to have increased 2% last month. Tuesday - consumer confidence and the index of leading indicators, with economists expecting a March reading of 50 in the Conference Board's confidence index, up from 46.3 in February and a rise in the index of leading indicators of 0.8% in February. BIG REPORTS AT WEEK'S END: Wednesday, Thursday and Friday will be filled with economic reports. Wednesday: Purchasing managers index - with a forecast of a rise to 53.4% in March, from 52.4% in February; construction spending - forecast to be up 1% in February. Thursday: Factory orders - expected to have gained 1% in February. Friday: March unemployment - expected to be unchanged from 7.3% in February. MACHINE TOOL ORDERS UP: Another sign of recovery came Sunday when the Association for Manufacturing Technology said orders for machine tools rose 6.4% last month from January. Factories use machine tools to make products ranging from cookware to appliances to aircraft. (End of package.) DOW JONES OPENS ON DOWNSWING: The Dow Jones average of 30 industrials opens Monday at 3231.44, after closing down 36.23 Friday. The New York Stock Exchange composite opens at 223.31, down 2.18. The American Stock Exchange market value opens at 394.36, down 4.50. The NASDAQ OTC composite opens at 604.67, down 10.73. 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