Path: bloom-picayune.mit.edu!snorkelwacker.mit.edu!news.media.mit.edu!americast.com!usa-post Newsgroups: usa-today.invest From: usa-post@AmeriCast.Com Organization: American Cybercasting Approved: usa-post@AmeriCast.com Subject: invest Fri, Apr 17 1992 Date: Fri, 17 Apr 92 05:42:11 EDT Message-ID: 04-17 0000 DECISIONLINE: Personal Investing USA TODAY Update April 17-19, 1992 Source: USA TODAY:Gannett National Information Network DOW REACHES ANOTHER RECORD: The stock market continued its record setting string Thursday as the Dow Jones industrial average pushed further into untouched territory. The Dow rose 12.74 points to 3366.50 - its third straight record. Other indexes were mixed. Losing stocks beat winners 898 to 805 on the New York Stock Exchange, where volume was 233 million shares. BE WARY OF BIOTECH STOCKS: This week's explosions in the mine-riddled biotech industry may be far from over, several biotech pros warn. Shares of Centocor and XOMA were drubbed Wednesday after the Food and Drug Administration said it would not approve their drugs to treat sepsis. In the wake of giant sell-offs in U.S. Bioscience and Immunex, many investors are ditching biotech stocks and shares of biotech funds. (For more, see special Biotech package below.) GM RISES ON PROFIT NEWS: Shares of General Motors jumped 2 3:8 to $42 1:4, a 52-week high, Thursday on the automaker's projections of a possible first-quarter profit. The Wall Street Journal reported that a GM forecast estimates that the top U.S. auto company could post a tiny first-quarter profit, its first profit in seven quarters. Analysts say GM's earnings will be much improved, but they still expect losses. SEARS REPORTS EARNINGS GAIN: Sears, Roebuck, helped by surging profits at its Dean Witter Financial Services unit, posted net income of $322 million, or 89 cents a share, last quarter, vs. $237 million, or 69 cents a share, a year earlier. Revenue rose 5% to $13.5 billion. But Wall Street was unimpressed. Sears shares fell 1 3:8 to $46 1:2. Some analysts say Sears' Merchandising Group expenses remain surprisingly high. MICROSOFT'S EARNINGS SOAR: Software giant Microsoft's earnings soared 44% the quarter ended March 31 on the continued strength of its popular Windows operating system. Net income climbed to $179 million or 90 cents a share from $124 million or 65 cents a share a year earlier. Revenue jumped 40% to $687 million. In after hours trading, Microsoft stock traded at $126 a share, down from its close of $127 5:8 Thursday. AIRLINE ESTIMATES BEING CUT: Airline analysts are trimming earnings estimates in the wake of American Airlines' announcement last week of a new cheaper, simpler fare structure - largely matched by the industry. Rose Ann Tortora of County NatWest cut her second-quarter per-share estimate for American's parent, AMR, from $2 to $1.25 and her 1992 estimate from $5 to $4 a share. Estimates for other airlines are being cut, too. AIRLINE STOCKS FALL: Some airline stocks have risen a bit since American's announcement. Still, AMR, UAL and Delta Air Lines shares all remain stuck near their 1992 lows. Thursday, AMR finished down 3:8 at $70 5:8, UAL fell 1 to $129 3:4 and Delta fell 3:8 to $60 1:4. Though many analysts think American's strategy appears a winner over the long haul, they're concerned about its immediate costs. T. ROWE PRICE BUYING FUNDS: Baltimore-based mutual fund company T. Rowe Price Associates said Thursday it plans to buy five stock funds and one money market fund from insurer USF&G. Terms of the deal for the six funds that have assets of $630 million and 50,000 shareholder accounts were not disclosed. The deal was announced after markets closed. T. Rowe Price shares finished down 1 at $35. USF&G was up 1:8 at $10 1:8. GOLD PRICES MIXED: Gold prices were higher in the USA but mixed abroad. On the New York Commodity Exchange, gold for current delivery rose $1.40 a troy ounce to $337.40. Later, Republic National Bank in New York quoted an ounce of gold bullion at $337.00, up $1.30. Gold rose in London but fell in Zurich. On New York's Comex, silver for current delivery closed at $3.967 a troy ounce, down 3.9 cents. SPECIAL PACKAGE ON BIOTECH: THIS YEAR WILL BE TOUGH ONE: Many biotechs fell Thursday amid Wall Street talk that Fidelity Management was a brisk seller. Fidelity, though, says there's no unusual selling of biotechs. Big biotech player David Blech, who owns a portfolio of biotech stocks still worth $320 million, sums up the biotech-investment mood. "It's been a tough year, and the Centocor and XOMA fiascoes will make it tougher," he says. INVESTORS LIGHTENING POSITIONS: Jeffrey Casdin, biotech analyst at Oppenheimer & Co., says that biotech may spend the rest of this year in a repair process. Reason: The speculators that drove up the stocks like crazy will continue to lighten their positions amid falling prices. Casdin says 100 stocks he tracks in his biotech index are off an average 30% from mid-January highs and down 15% since year-end. BIG GROWTH SEEN FOR AMGEN: Casdin likes Chiron and Amgen, for which he sees earnings growth of 35% to 40% a year through 1995. His estimates: $2 a share this year, $2.75 next year and $5 in '95. He says Chiron could lose $1 a share this year but turn profitable next year and post $1.50 a share in '95. Jeffrey Malet of Pacific Century Advisors says avoid XOMA "like the plague." Of Centocor: "The outlook is grim." (End of package.) DOW JONES OPENS ON UPSWING: The Dow Jones average of 30 industrials opens Monday at 3366.50, after closing up 12.74 points Thursday. The New York Stock Exchange composite opens at 228.90, down 0.25. The American Stock Exchange market value opens at 392.64, down 1.52. The NASDAQ OTC composite opens at 591.81, down 8.22. DOLLAR OPENS UP OVERSEAS: The dollar opens up on Monday. It opens at 0.5732 British pounds, up from 0.5669; 5.6375 French francs, up from 5.6175; 1.6685 German marks, up from 1.6630; and 133.95 Japanese yen, up from 133.30. (As of 3 p.m. Thursday. 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: William Snoddy. (1-919-855-3491) 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