Path: bloom-picayune.mit.edu!snorkelwacker.mit.edu!news.media.mit.edu!americast.com!americast.com!usa-post Newsgroups: usa-today.invest,americast.usa-today.invest From: usa-post@AmeriCast.Com Organization: American Cybercasting Approved: usa-post@AmeriCast.com Subject: invest Fri, Oct 2 1992 Date: Fri, 2 Oct 92 04:56:03 EDT Message-ID: 10-02 0000 DECISIONLINE: Personal Investing USA TODAY Update Oct. 2-4, 1992 Source: USA TODAY:Gannett National Information Network SEPTEMBER JOB REPORT DUE OUT: Friday is the day Wall Streeters have been talking about for two weeks. The government will report September job growth. And, in the almost certain event that what it really reports is big-time job anti-growth, the Federal Reserve will be handed what may be its best chance to cut short-term interest rates for a long time. Investors are braced for bad news. (For more, see special Jobs package below.) PEROT CONFUSES ANALYSTS: The talk of Wall Street Thursday came after the close, when Ross Perot announced his official entry into the presidential race. Analysts are perplexed. A bullish scenario: Perot's challenge prompts the other candidates to offer better plans to cut the deficit. A bearish scenario: Investors are spooked by the possibility the election will be decided in the House. DON'T TRUST GOLD TOO MUCH: European markets are in chaos. And yes, gold, often seen as a safe haven in uncertain times, has been inching higher. In the last few weeks, an ounce of gold has risen 5% to as high as $349.30 Friday. But consider a report from S.G. Warburg Securities: "For gold to regain its luster ... it would require the complete erosion of confidence. ... the price (almost certainly) will drift." LOWER RATES MIGHT NOT HELP: Lower interest rates - possible in light of an expected grim jobless report - might help the economy, if they stimulate borrowing and spending. The Fed has pushed rates down 23 times in three years, however, and growth has stayed weak. One bank cut its prime lending rate Thursday. First Fidelity Bancorp of New Jersey, a large regional bank, cut its prime to 5.5% from 6%. BROKERS MAKE FUN OF INVESTORS: Stockbrokers have names for investors that give them more trouble than they are worth. According to industry trade magazine, Registered Representative, here are some of them: Wish I was a mailman - demands too much literature; Chatterbox - calls the broker way too much; Dreamer - feels entitled to 10% a year returns with little risk. ANALYSTS ARE UNIMPRESSED: Robert Palmer, who officially stepped in Thursday as President and CEO of loss-plagued Digital Equipment Corp., took to the podium and promised investors Digital will change. But Wall Street was unimpressed. The reason, analysts say, is that the 52-year-old Palmer gave few specifics about Digital's future during almost an hour of questioning by reporters and stock analysts. GOLD, SILVER FALL: Precious metals fell Thursday. On the Commodity Exchange, gold bullion for current delivery fell 30 cents to $347.50. Republic National Bank of New York quoted a late bid price of $348.10, off $0.20. Gold fell in London to $348.45, down from $348.75. Silver on the Comex was quoted at $3.714 a troy ounce, down from $3.739. Silver fell in London to $3.75, down from $3.76. DOW JONES OPENS ON DOWNSWING: The Dow Jones average of 30 industrials opens at 3254.37 Friday after closing down 17.29 Thursday. The New York Stock Exchange composite opens at 228.73, down 0.73. The American Stock Exchange market value opens at 374.81, down 1.91. The NASDAQ OTC composite opens at 578.33, down 4.94. DOLLAR OPENS MIXED OVERSEAS: The dollar opens mostly up on Friday. It opens at 0.5754 British pounds, up from 0.5642; 4.8120 French francs, down from 4.7970; 1.4220 German marks, up from 1.4180; and 119.76 Japanese yen, down from 120.00. (As of 3 p.m. Thursday. Source: First American Bank of New York.) SPECIAL PACKAGE ON JOBS: REPORT WORRIES INVESTORS: The September job report is due out Friday and investors are worried. The expected bad jobs numbers alone won't upset the stock and bond markets. But another Fed rate cut also is expected Thursday. The potential for disappointment there is frightening. The dollar's falling again and another cut in interest rates would speed that decline. FALLING DOLLAR WOULD HURT: The stock market wouldn't like that a bit. So a lot of traders have been waiting out this period and the jobs report will give them answers. The worst case: Job losses far exceed what is expected, and the Fed declines to cut rates anyway. Analysts think that could trigger a bear market it stocks. Best case: Strong growth with the Fed avoiding more cuts. Stocks could rally quickly. STOCKS SHOULD STAGNATE: The likely case: Job losses as expected, and the Fed cuts short rates one final time. That should keep stocks and bonds about where they are. But nothing is certain. Investors are fearful of election uncertainties, especially with Ross Perot's entrance into the race. Investors are also worrying about third-quarter earnings reports. Many may sell stocks if they don't get good news soon. (End of package.) 24-HOUR TELEPHONE INFORMATION: USA TODAY Money Hot Line. 95 cents a minute. 1-900-555-5555. Personal Investing editor: Martin Baucom. (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