Path: bloom-picayune.mit.edu!snorkelwacker.mit.edu!news.media.mit.edu!americast.com!americast.com!usa-post Newsgroups: usa-today.invest From: usa-post@AmeriCast.Com Organization: American Cybercasting Approved: usa-post@AmeriCast.com Subject: invest Tue, Aug 11 1992 Date: Tue, 11 Aug 92 04:32:26 EDT Message-ID: 08-11 0000 DECISIONLINE: Personal Investing USA TODAY Update Aug. 11, 1992 Source: USA TODAY:Gannett National Information Network MCDONNELL CHANGES SEND STOCK UP: McDonnell Douglas stock jumped 2 1:4 to close at $36 5:8 Monday after it announced further streamlining in response to shrinking defense spending. McDonnell, the top U.S. defense contractor, says it will merge six defense and aerospace divisions into two and may sell the unit that makes the Army's Apache helicopter. The company also says it will close its Columbus, Ohio, plant next year. CONSOLIDATION COULD SAVE MILLIONS: Consolidation of McDonnell Douglas' defense units could save the company more than $100 million a year, officials say. Stock jumped Monday on news of further streamlining for the aerospace company. The company has said its policy is to concentrate on businesses in which it can be the No. 1 or No. 2 player. INVESTORS A LITTLE PERTURBED: Tens of thousands of would-be investors rampaged through Shenzhen, China, Monday after they were denied applications to buy stock on the fledgling Shenzhen stock exchange. The protesters were frustrated in their attempts to obtain applications to buy stock and charged that police used their power to get relatives into the best places in line. A million investors have come to Shenzhen. NIKKEI TAKES ANOTHER DIVE: The Japanese stock market plunged again Monday. The widely watched Nikkei average fell 451.93 points, or 2.9%, to 15,066.34, its lowest since April 1986. Economist and Japanese expert Sam Nakagama said Monday that investors are gloomy because the economy is weak - and continuing to tumble. He said the economy will "actually shrink" in the second and third quarters. INVESTORS ARE SPOOKED: Corporate profits, likely to be down in the fiscal year's first half, are spooking investors in Japan, according to expert Sam Nakagama. Among the hardest-hit sectors of the Japanese economy: Real estate and banks that made loans to develop land. They're among Japan's largest stock owners. Deflation in stock and land prices will lead to more problem loans, Nakagama projects. EMPLOYEES OWN PIECE OF KROGER: If TWA's 29,000 workers agree to wage concessions, as proposed, they would get 45% of the company. The largest companies with employeee ownership of 30% or more, according to the Employee Stock Ownership Plan Association, include Kroger, with 170,000 employees; McDonnell Douglas, with 128,000; Rockwell International, with 109,000; Publix Supermarkets, with 65,000; and Bethlehem Steel, with 31,000. DON'T IGNORE STOCKS: Wall Street wisdom says smart money doesn't follow the crowd. But this year, small investors have stampeded into bond mutual funds - and they're running in first place. But some pros say it's time to favor stocks over bonds. Falling interest rates, which boost bond yields, also give stocks a lift. Stocks tend to outperform bonds in the long run. SALOMON CRITICIZES SEC PLAN: Salomon Bros. said Monday proposed Securities and Exchange Commission rules for asset-backed securities are too restrictive. Salomon said the rules would increase the costs of certain types of financing. In a letter last week to the SEC, Salomon made several suggestions in response to the proposed rules on the development of asset-backed securities. PROPOSAL RESTRICTS ASSET-BACKED: Asset-backed financing pools financial assets such as mortgages and converts them into capital market instruments. Last year, it accounted for about half the U.S. publicly offered securities. Under a proposal from the Securities and Exchange Commission, only fixed-income securities in the top two Moody's or Standard & Poor's categories can be sold to anyone but institutional advisors. T-BILL INTEREST RATES FALL: Interest rates on short-term Treasury securities fell in Monday's auction with rates on six-month bills dropping to their lowest level in 20 years. The Treasury Department sold $11.68 billion in three-month bills at an average discount rate of 3.13%, down from 3.20% last week. The rate was the lowest since the bills sold for 3.07% on Feb. 14, 1972. STOCKS INCH UP IN LANGUID DAY: Stocks edged up Monday in spite of big losses overseas. The Dow Jones industrial average gained 5.40 points to 3337.58. Broader indexes were mixed. Winners trailed losers 798 to 960 on the New York Stock Exchange, where volume was light at 142 million shares. Stocks dropped in the morning and stayed down most of the day. GOLD, SILVER MIXED: Gold and silver prices were mixed Monday. Republic National Bank quoted a late bid of $350, off $1, after gold rose 10 cents to $350.40 on the Commodity Exchange. Gold fell in London to $350.50 from $351.15. Silver fell .7 cent to $3.955 on the Comex. In London, silver rose to $3.96 from $3.93. DOW JONES OPENS ON UPSWING: The Dow Jones average of 30 industrials opens Tuesday at 3337.58 after closing up 5.40 points Monday. The New York Stock Exchange composite opens at 230.86, up 0.07. The American Stock Exchange market value opens at 880.41, down 1.72. The NASDAQ OTC composite opens at 573.14, down 0.60. DOLLAR OPENS MIXED OVERSEAS: The dollar opens mostly down on Tuesday. It opens at 0.5186 British pounds, down from 0.5193; 4.9590 French francs, down from 4.9710; 1.4659 German marks, down from 1.4705; and 127.95 Japanese yen, up from 127.63. (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. Personal Investing editor: Beth Mann. (1-919-855-3491) Making copies of USA TODAY Update (Copyright, 1992) for further distribution purposes 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