Moving higher near the final bell, the Dow Jones industrial average gained 6.92 points yesterday to close at 3,449.93. Drug stocks were strong, with Merck, Pfizer and Schering Plough showing point-plus gains following reports that the White House would soften its position on cutting drug prices and profits.
WALL ST. WISDOM: "During the last five years stocks experienced only one significant decline, a relatively modest 21 percent drop during the 1990 Gulf crisis, and this current uptrend marks one of the longest in history. Will the next pullback turn into something more serious? Bears contend that the market is extremely overvalued by all criteria. Bulls say that the Fed's easy-money policy has pushed interest rates down to 20-year lows, a bullish sign. We suggest that 50 percent of your money go into recommended mutual funds, 50 percent to a cash reserve." (Mutual Fund Forecaster).
BALTIMORE BITS: Looking for the right stockbroker? You'll find good hints in a booklet that Ferris, Baker Watts' Michael Dougherty will send you. For your copy of "Total Stock Management: The Ideal Stock Broker & The Ideal Client," phone 659-4677. ("The ideal broker puts his clients' interests first, is a straightforward person to deal with and offers a structured strategy for reaching your goals.") . . . Dean Witter's Jack Rosenbloom (547-7027) will mail his updated "Finding Higher Yields in the Fixed Income and Equity Markets." ("Unfortunately there are few 'risk-free' investments offering higher yields, but you can extend maturities, 'ladder' your portfolio, consider higher yielding stocks, etc.")
HIGHEST YIELDS: In response to many requests, here, from the latest "100 Highest Yields," is an updated list of area institutions that offer the highest insured yields. Money Market Funds: Loyola Federal, Eastern Savings, Maryland National Bank. Six-month CD: Loyola Federal, Chevy Chase Savings, Eastern Savings. One-year CD: Loyola Federal, Maryland National Bank, Eastern Savings. Two-and-a-half year CD: Eastern Savings, Loyola Federal, Maryland National Bank.
HONOR ROLL: What follows are, in order, top-performing mutual funds for the last five years, with five-year compounded annual gain percentages in parentheses. It's from Money magazine's "Money Guide," Summer 1993 edition, a jampacked, valuable 128-page publication, $3.95. Mid-Sized-Company Growth Funds: Vista Capital (27), 20th Century Ultra (24), AIM Constellation (23), ABT Emerging Growth (22) and Hartwell (21). Total Return Funds: Fidelity Convertible (19), Financial Industrial (18), Massachusetts Investors Trust (16), Fidelity Advisor (16) and USAA Mutual Income Stock (15). Overseas Funds: Harbor International (15), GAM Pacific Basin (13), Templeton Growth (13), Scudder Global (13) and Templeton Foreign (12).
HOPEFULLY HELPFUL: "If you owe the IRS money, you can now devise your own payment schedule by filling out Form 9465. The tab must be less than $10,000. Call 800 TAX-FORM." (Business Week, May 24) . . . "Since 1933, the average upward cycle of small-capitalization stocks lasted about six years with an average annualized 29 percent gain. The small-cap market bottomed out in 1990 and today it's on a recovery course, with historical performance suggesting the upward cycle could continue into 1997." (John Hancock ad) . . . "Don't use traveler's checks abroad unless you have to. When you pay for an airline ticket, car rental, hotel room, meals, etc., with a traveler's check, you're at the mercy of exchange rates that merchants set. Best strategy: pay by credit card, most of which use more favorable rates." (Dollar Stretcher.)
LOOKING AHEAD: "Short-term interest rates are close to the bottom but long-term rates are not. The next move in interest rates is up because of higher inflation." (Carter Randall) . . . "Inflation isn't as bad as last week's figures indicate; recession will keep prices in check. I'd buy long-term bonds now." (Louis Holland) . . . "Put one-half of your money overseas now; for example, the T. Rowe Price International Fund or Harbor International Fund. Interest rates abroad will drop sharply soon." (Howard "Pete" Colhoun) . . . "Stocks will rise now because of still lower interest rates, but investors should use caution nevertheless. If Congress passes the tax bill, some inflation will result. I hope Congress defeats Clinton's tax bill; never in our history have increased taxes led to anything but higher unemployment." (Lawrence Kudlow, chief economist, Bear Stearns). Above quotes from "Wall Street Week With Louis Rukeyser."
"Looking ahead, another acceleration of economic activity is likely before year-end as the Fed continues to maintain an extremely stimulative economic policy." (Mercantile-Safe Deposit & Trust Co.).