'Glamour' stocks drop Dow 7 points


Edging up in late trading, the Dow Jones industrial average gained 6.99 points yesterday and closed at 3,535.28.

But Merck, a Dow Jones one-time "glamour darling" which reached 53 within the last year, fell one point to 32 1/8 . And IBM, another former Dow favorite which touched 101 last year (and 139 the year before), dropped 2 points to 43 5/8 .

As an ancient philosopher observed, "We all change places at the rising of the moon."

MONEY TALK: "I'm opposed to millionaires, but it would be dangerous to offer me the position." (Mark Twain, 1881) . . . "You can only drink thirty or forty glasses of beer a day, no matter how rich you are." (Adolphus A. Busch, 1924) . . . "The poorest man at the table always picks up the check." (Milton F. Westheimer, my father, 1872-1956.)

BALTIMORE BEAT: Mercantile Safe Deposit & Trust Co. says, "While the U.S. market has attained record levels, other markets reflect depressed conditions abroad and offer opportunities to investors. We will expand our exposure to opportunities such as Nestle, Lever Brothers, Imperial Chemical, Cable & Wireless, etc." Phone Richard Kodenski (237-5900) for the full letter . . . Southwest Airlines, about to make its debut into BWI airport, sports an NYSE ticker symbol LUV. An airline spokesman told me, "It signifies how much we 'LUV' our passengers." The stock gained 2 1/2 points last week, closing at 31 7/8 . Within the last year you could have bought all you wanted around 14 . . . I answer your money questions "live" on WBAL-TV (Channel 11) every weekday at 5:45 a.m. and 6:45 a.m., Saturdays at 8:15 a.m. We display the call-in number on the screen.

MARYLAND MEMOS: U.S. Surgical stock, widely held in this area, fell 2 1/2 more points last week to 25 1/8 . Within the last 12 months the one-time local favorite sold as high as 106 . . . The new Moody's Handbook of Common Stocks, summer edition, shows that if you had bought Baltimore Gas and Electric stock 10 years ago (average price 10, adjusted for splits), you would have more than doubled your money (today's price about 26) but -- more importantly -- you would now be receiving a 14.8 percent yield on your 1983 investment as the firm boosted its payout in nine of the last 10 years . . . For a prospectus on T. Rowe Price Associates' new Blue Chip Growth Fund, phone Steven Norwitz at 547-2124 or Rowena Itchon at 547-2242 . . . Says Investment Counselors of Maryland, "Opportunities in the stock market may not be in the broad indexes, but in carefully selected individual issues where improving fundamentals are identified." Call the firm (539-3838) for the full July letter.

SUMMER READING: One of the easiest-to-read, down-to-earth, practical advice books about money since Peter Lynch's "One Up on Wall Street" is a new, slim volume, "The Wealthy Barber," by David Chilton ($18.95). Through numerous fictional conversations between barber Roy Miller and his customers, we learn how to make money grow. Excerpts: "If you want to learn to do something right, watch someone who has done it successfully." . . . "Wealth beyond your wildest dreams is possible if you follow the golden rule: Invest 10 percent of all you make for long-term growth. Follow that rule and some day you'll be very rich." . . . "If you had started putting $30 a month away ($1 a day) at age 18 and continued until age 65, averaging a 15 percent annual return, you would have $2,679,000!" More quotations on Thursday.

LOOKING BACK: Regarding the recent news story, "Pennies Lose Their Shine: Many Firms, Patrons Disregard Coins," (The Sun, July 18), I recall childhood warnings my parents issued about pennies. Mother (sternly): "Son, a penny saved is a penny earned." . . . "Julius, save your pennies for a rainy day." . . . "Don't embarrass Aunt Addie by always asking her to take you to the movies for 15 cents; she has to watch her pennies." . . . Dad: "Two pennies represent the interest on a dollar invested for a year." (That was true in The Depression when savings bank interest sank to 2 percent) . . . "Son, don't waste money. Look what I do; instead of mailing checks, I have my secretary deliver them to save 2 cents postage."

STOCK WATCH: "Stocks of 'brand-name' companies will remain dormant for a while, but investors should buy industrial cyclical issues, like steels, auto parts, etc." (William Waters) . . . " We've had a good six months -- 80 percent of the world's stocks are up -- and I'm still bullish for the next six months. My favorites are Compaq, Intel and the bank stocks." (Laszlo Birinyi) . . . "I like the financial area -- Fannie Mae, J. P. Morgan and AIG, all with excellent earnings." (Lou Holland). Above three quotes from Friday's "Wall Street Week With Louis Rukeyser." The guest, Neuberger and Berman's Kent Simons, said, "I'm a bargain hunter; I look for stocks that are 'unjustifiably cheap.' I now favor the whole financial area -- Fannie Mae, First Fidelity Bank and Signet Bank. We also added some drug stocks. We try to buy the best company in the most out-of-favor industries." . . . "The long-term bull market in stocks and bonds may have several more months to live, but the risks are increasing." (Klein-Wolman Investment Letter) . . . "We are sticking with our faith in low interest and inflation rates coupled with a positive [if soft] corporate picture of improving earnings to support higher stock prices." (The Prudent Speculator).

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