Path: bloom-picayune.mit.edu!snorkelwacker.mit.edu!news.media.mit.edu!americast.com!americast.com!usa-post Newsgroups: usa-today.banks From: usa-post@AmeriCast.Com Organization: American Cybercasting Approved: usa-post@AmeriCast.com Subject: banks Wed, Jun 10 1992 Date: Wed, 10 Jun 92 05:20:05 EDT Message-ID: 06-10 0000 DECISIONLINE: Banking & Economy USA TODAY Update June 10, 1992 Source: USA TODAY:Gannett National Information Network PROFITS EXPECTED TO RISE: U.S. companies could see pretax profits jump 16.5% this year and 13.3% next year, a survey of top economists by Blue Chip Economic Indicators said Tuesday. Last year, corporate profits fell 3.8% after falling 9.3% in 1990. The consensus of the economists was that the gross domestic product will grow 2.1% this year and inflation will rise 3.2% - the same consensus as the last survey. DOW FALLS SHARPLY: Nervous investors pushed stocks sharply lower Tuesday ahead of inflation reports Thursday and Friday. The Dow Jones industrial average sank 34.21 points to 3369.92. Other indexes also fell. Decliners swamped advancers 1,160 to 580 on the New York Stock Exchange, where volume was 191 million shares. DROP COULD BE SIGN: Tuesday's sell off by investors on Wall Street could signal trouble for the market this summer, analysts say. "It's still too early to say," says Gregory Nie, analyst at Kemper Securities. But he says he wouldn't be surprised if the Dow drops as much as 200 points, or 6%, by the end of the summer. Oppenheimer strategist Michael Metz says the Dow has topped out for the year. BOWSHER SEES IMPROVEMENT: An improving economy might reduce the number of banks that regulators have to close, says Comptroller General Charles Bowsher. Bowsher told the Senate Banking Committee Tuesday that one hopeful sign is the spread between interest that banks receive for loans and what they must pay for deposits. Right now, that's an unusually wide four percentage points, he says. FOREIGN INVESTMENT DOWN: Direct foreign investment in the USA - purchase of 10% or more of a U.S. company - plunged to $22.6 billion last year from $65.9 billion in 1990, the Commerce Department said Tuesday. Investment from Japan was No. 1 last year - $5.1 billion - but down sharply from the investment of $19.9 billion in 1990. French investors were No. 2 with $4.8 billion, followed by Canadians with $2.7 billion. CONSUMER DEBT PLUNGES: Consumer credit fell at an annual rate of 6.3% in April, the steepest drop in nearly 12 years. The Federal Reserve said Tuesday that outstanding consumer debt fell to $723.6 billion. Revolving credit, including credit cards, rose at a 3% annual rate to $245.9 billion. Auto loans fell at a 9% annual rate to $260.2 billion. Other consumer loans fell at a 13.5% annual rate to $217.5 billion. BANK HOPES TO BOOST PORTFOLIO: NationsBank says it hopes to triple its credit-card portfolio, American Banker reports. The bank's goal is to boost its credit-card business to $12 billion in outstanding balances the next three years. Kenneth Lewis, who heads the bank's retail operations, says that's part of an overall strategy to increase consumer loans to 50% of its portfolio from 39%. ACQUISITION BOOSTS WHOLESALERS: Shares of food wholesalers SuperValu and Wetterau advanced Tuesday after SupperValu said it will buy Wetterau in a $1.1 billion deal. Wetterau shares rose 6 3:8 to $30 3:8 in heavy trading, while SuperValu shares inched up 1:8 to $25 1:2. SuperValu will assume debt of about $440 million and pay $643 million, or $30.20 a share, in cash for Wetterau. OIL PRICES DOWN: Oil prices fell in slow trading Tuesday. Light sweet crude oil for delivery in July settled at $22.32 a barrel, down 12 cents, at the Mercantile Exchange. Unleaded gasoline for delivery in July settled at 66.87 cents a gallon, down .30 cent. Home heating oil for delivery in July settled at 60.56 cents a gallon, down .75 cent. GOLD MIXED, SILVER UNCHANGED: Gold prices were mixed and silver prices were unchanged Tuesday. In New York on the Commodity Exchange, gold bullion for current delivery settled at $338.30 a troy ounce, up 10 cents. Republic National Bank said gold slipped 10 cents to $337.80. On the Comex, silver bullion for current delivery settled at $4.041 a troy ounce, unchanged. In London the metal also was unchanged at $4.05. DOW JONES OPENS ON DOWNSWING: The Dow Jones average of 30 industrials opens Wednesday at 3369.92 after closing down 34.21 Tuesday. The New York Stock Exchange composite opens at 225.95, down 1.76. The American Stock Exchange market value opens at 393.06, down 3.37. The NASDAQ OTC composite opens at 573.80, down 8.21. DOLLAR OPENS UP OVERSEAS: The dollar opens up on Wednesday. It opens at 0.5459 British pounds, up from 0.5452; 5.3600 French francs, up from 5.3500; 1.5925 German marks, up from 1.5855; and 127.57 Japanese yen, up from 127.11. (As of 3 p.m. Tuesday. 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