Stocks mixed amid worry about profits


NEW YORK -- Stocks were mixed yesterday amid concern about rising interest rates and forecasts for lower-than-expected earnings from such leading companies as Eastman Kodak Co. and Westinghouse Electric Corp.

The Dow Jones industrial average fell 17.60 points, to 3,613.65, and lost 8.38 points for the week. But advancing stocks on the New York Stock Exchange exceeded declining issues by a slight margin.

"Investors are starting to worry about whether corporate earnings will beat analysts' estimates," said John Brooks, director of sales and marketing at Notley Group. "It's a concern that won't be answered for several weeks, and it's a concern that's going to keep a lid on stocks."

Trading volume set a high for the year, with about 381 million shares changing hands on the NYSE. It was the seventh-highest number of shares to trade in one day in the exchange's history.

Most of yesterday's trading was related to the "triple witching" expiration of stock-index options and futures and options on individual stocks. "The quarterly expiration is responsible for much of today's trading," said Todd Clark, a trader at Mabon Securities Inc. "There's no question about that."

The Standard & Poor's 500 Index fell 0.60, to 458.83, and the American Stock Exchange Market Value index declined 0.87, to 452.81. The Nasdaq Combined Composite Index bucked the downward trend, gaining 0.31, to 740.11.

Shares of oil companies were among the worst performers. Oil stocks fell after an analyst at Lehman Bros. cut his earnings estimates for the group and lowered his investment rating on Exxon Corp. Exxon declined 37.5 cents, to $65.125; Mobil Corp. fell $1, to $76.125; and Chevron Corp. lost 75 cents, to $91.

Meanwhile, long-term interest rates rose and weighed down the stock market, said William Raftery, market analyst at Smith Barney Shearson Inc. The yield on the 30-year Treasury bond rose to 6.04 percent, from 6.03 percent Thursday.

The increase in interest rates was attributed partly to concern that inflation might be more troublesome than some economists had thought. The Labor Department reported earlier this week that consumer prices rose 0.3 percent last month, exceeding economists' forecasts and causing bond yields to rise.

Not everyone believes that inflation is a threat. "There is no question we're seeing tepid economic growth with little inflation," said Jim Coxon, director of equity services at Kemper Financial Services Inc.

The key to profiting in this stock market, Mr. Coxon said, is buying companies that generally benefit from an economic recovery and have also taken steps to cut costs.

Shares of Antec rose 33 percent from their initial public offering price of $18 on the company's first day of trading as a public company. The stock closed at $24.

Eastman Kodak fell $1.875, to $59.875, after the company said its third-quarter earnings would probably fall below last year's results.

Westinghouse Electric Corp. fell $1.125, to $13.75. The electrical equipment company also said third-quarter earnings would be below expectations. The company said earnings would be down 50 percent from the 22 cents a share earned in last year's third quarter.

General Motors Corp. declined $1.125, to $45.75. The Wall Street Journal reported that the tentative national labor agreement reached late Wednesday was bad for GM because it did not include major changes in the labor-cost structure that GM needs to make its U.S. operations competitive.

GM must decide whether to accept the accord or risk confrontation with the United Auto Workers union.

U S West Inc. surged $1.125, to $47.50. The telecommunications company said it would take an after-tax charge of $3.8 billion in the third quarter to eliminate 9,000 jobs over three years, and to adjust for an accounting change.

Whirlpool Corp. rose $1.875, to $59.125, after the appliance maker, responding to the recent decline in its stock, said its operating performance remained strong. It expects second-half results to be up solidly from a year ago and 1993 operating earnings to rise 20 percent to 30 percent from 1992 levels.

Qualcomm Inc. advanced $2.375, to $76.25. The developer of wireless communications technologies reached a partial agreement in a patent dispute with InterDigital Communications Corp.

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