Path: bloom-picayune.mit.edu!snorkelwacker.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 Tue, Oct 27 1992 Date: Tue, 27 Oct 92 04:59:45 EST Message-ID: 10-27 0000 DECISIONLINE: Personal Investing USA TODAY Update Oct. 27, 1992 Source: USA TODAY:Gannett National Information Network GM CHAIRMAN RESIGNS: General Motors Corp. Chairman Robert Stempel resigned Monday amid persistent rumors the board of directors wanted him out because of his failure to act more swiftly to stem the automaker's continuing losses. GM has reported losses every quarter since his appointment and a third quarter loss of $845 million will be announced this week. GM will cut 74,000 hourly and salaried jobs. (For more, see special GM package below.) GDP TO MARK EXPANSION'S START: Tuesday's report of third quarter gross domestic product is expected by virtually all economists to mark an important milestone - surpassing the level of goods and services that peaked in 1990. At that point, in economic parlance, the recovery will be officially over and the expansion will have begun. The economy peaked during the second quarter of 1990 at $4.9 trillion. U.S. HEALTHCARE SLIDES: U.S. HealthCare stock slid 3:8 Monday to $43 3:8 after the company reported higher earnings but lower profit margins. Salomon analyst Mago Vignola noted the health maintenance organization's medical loss ration - the difference between what it spends and what it takes in in premiums - rose to 78.3 from 77.2 a year ago. But Vignola says she is keeping her buy rating on U.S. HealthCare. HOLIDAY SPENDING STUCK: Holiday spending plans are stuck in the mud, two recent consumer surveys show. Shoppers say they plan to hold back on gift-buying again this year. But some retail watchers hope the election will jump-start consumer spending. An annual MasterCard Holiday survey found that of 1,000 cardholders, 49% plan to spend the same as last season, compared to 44% last year. NATIONSBANK, DEAN WITTER TEAM: NationsBank and Dean Witter Monday announced plans to jointly sell stocks, bonds and other investments to customers in NationsBank branches - the latest sign the boundary between banks and brokerages is blurring. The new company, to be based in NationsBank's hometown of Charlotte, N.C., will be called Nations Securities. NationsBank and Dean Witter will be 50-50 partners. VENTURE SHOULD PRODUCE: NationsBank's new alliance with Dean Witter will have a modest beginning. When the new company, Nations Securities, opens in first-quarter 1993, it will have about 400 brokers. But the firm could eventually push NationsBank into the big leagues of the brokerage business. Many analysts believe this is a great move because banks are experiencing slow loan growth. GOLD, SILVER LOWER: In trading on the New York Commodity Exchange Monday, gold bullion for October delivery closed $2.50 lower at $341.10 a troy ounce. December silver settled 2.5 cents lower at $3.757 a troy ounce. DOW JONES OPENS ON UPSWING: The Dow Jones average of 30 industrials opens at 3244.11 Tuesday after closing up 36.47 Monday. The New York Stock Exchange composite opens at 229.78, up 1.95. The American Stock Exchange market value opens at 376.16, up 1.92. The NASDAQ OTC composite opens at 598.92, up 1.63. DOLLAR OPENS UP OVERSEAS: The dollar opens up on Friday. It opens at 0.6343 British pounds, up from 0.6182; 5.2290 French francs, up from 5.1845; 1.5420 German marks, up from 1.5290; and 122.20 Japanese yen, up from 121.95. (As of 3 p.m. Monday. Source: First American Bank of New York.) SPECIAL PACKAGE ON GM: ANALYSTS RETHINK CONCLUSIONS: GM Chairman Robert Stempel's resignation Monday has some investors rethinking earlier conclusions that GM was the worst-looking of the auto stocks. Sensing an imminent shake-up that would repair GM's earnings ability, and with a GM board meeting scheduled for Monday, investors started buying the stock. It rose 15% last week. Analysts like the idea that GM is streamlining operations. DOWNSIZING SHOULD HELP GM: "Anything that gives GM the freedom or impetus to cut costs quicker has to be a positive," says Bill Stromberg, portfolio manager of T. Rowe Price Equity Income Fund. A streamlined GM is good for Chrysler and Ford, too. So in rushing to GM's stock now, investors may be chomping at the wrong bit. GM has enough plants and equipment to supply 42% of cars and trucks in the USA. ALL AUTO STOCKS LOOK GOOD: Yet GM's market share, which has been eroding, is only 35%. Joe Phillippi at Lehman Bros. says he upgraded his opinion of GM, but bumped Ford and Chrysler up a notch as well. His favorite among the three: Chrysler. Analysts generally are bullish on the whole industry, pointing to U.S. carmakers' recent success in taking market share away from the Japanese and signs of economic recovery. (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