Interest-rate fears drive Dow down


Profit-taking, weakness in foreign stock markets and fear of still higher interest rates pushed stocks lower yesterday.

At the final bell, the Dow Jones industrial average was off 23.76 points, closing at 3,670.25. Prices improved from a 43-point Dow deficit in early afternoon when American Airlines' flight attendants called off their strike.

WALL STREET WISDOM: "The time to invest money is when you have it. If you stall around and the market goes lower you certainly won't invest. You'll say, 'I wouldn't dream of buying stocks in this terrible market!' And if you stay on the sidelines and stocks go up, you won't invest either. You'd think, 'I wouldn't dare chase stocks at these high prices!' Over the years stocks -- no matter when you bought them -- outperformed most other investments by a substantial margin. The idea is to invest, and to start early!" (The late Charles H. Pinkerton, my first boss.)

LOOKING BACK: 30 years ago yesterday, Nov. 22, 1963, on the day that President John F. Kennedy was murdered, the Dow Jones industrial average opened at 732 and remained steady most of that Friday morning, but the index plunged rapidly after lunch as news of the assassination spread. In a rare move, New York Stock Exchange officials closed the market at 2:05 p.m., but the Dow Jones industrial average fell 21 points on that shortened day, closing at 711, a 3 percent drop (equal to about 110 points from today's level.) On Tuesday after the funeral -- markets remained closed on Monday -- the Dow surged 32 points, closing at 743. (Decimals dropped.) On Wednesday, a headline exclaimed, "Turnover soared to a '63 high of 9.3 million shares." (Today's average daily volume is about 260 million shares.)

1963 PRICE LIST: Some prices from that weekend's yellowed newspapers: Sun, Evening Sun and News-Post were 7 cents: Chesapeake Cadillac new '63 model, $5,537; six-pack Rigoletto cigars, 69 cents; Read's drug stores' "Saturday Luncheon Special" of roast young turkey with Virginia baked ham over celery dressing, cranberry sauce, buttered whipped potatoes, peas, hot rolls and butter, $1; Brooks Bros. cashmere sweaters from Scotland, $22.50; boys' and girls' all-weather coats with zip-out lining from Hochschild Kohn, $13.90; Elvis Presley in the film "Roustabout," Harundale Mall movie theater, 50 cents.

LOOKING AHEAD: Wall Street sentiment appears to be divided about half and half. A cross-section: "The stock market has further to go, subject to periodic corrections, with a strong emphasis on earnings-driven stocks." (Barrington Research) . . . "Ten reasons to expect a significant correction soon: High valuation, frothy action, record new issues, shrinking cash, sentiment smoke screen, foreign competition, correction way overdue, defensive Democrats, NAFTA naysayers, rising rates." (Dillon Read) . . . "Demise of the market appears to be over the horizon and out of sight. With the Dow Jones industrial and transportation averages at all-time highs, the bears have to throw in the towel." (John Martone Letter) . . . "There are times when the risk of a market decline are considerably higher than the opportunity of an advance. This is one of those times." (Institutional Monitor) . . . "I sense a market that may bend in the coming weeks, but not much. It should also cleanse the market of weak holders and may set the market up for another noticeable rally between now and the spring." (Ray Hines, Wall Street Generalist.)

HOPEFULLY HELPFUL: Chapin, Davis' "The Disciplined Contrarian" newsletter says, "The final result for our 1992 inaugural Stocking Stuffer list was a total return (gain plus income) of 24.5 percent. Selections for the coming year are Betz Labs, DeLuxe Corp., Fredericks of Hollywood, General Binding, Gilbert Assoc., Interstate Bakeries, McGrath Rentcorp., National Service Industries and TAB products." (Phone David Clogg or Michael Walker ([410] 435-3200) for details and questions) . . . "A capital gains tax is a problem you smile at." (Overheard on local talk show) . . . "My recent cautious commentary was not designed to keep investors out of stocks, but to ensure that readers are fully aware of the risks in any market environment. With so many novice readers being swept up in the move from riskless investments into stocks, I am compelled to focus on reducing risks, not maximizing gains." (Steven Halpern, editor, Dick Davis Digest) . . . Barron's, dated yesterday and on newsstands this week, lists Chevy Chase Federal Savings Bank, Loyola Federal Savings & Loan, Equitable Federal Savings (Wheaton) and Eastern Savings under "Top Savings Deposit Yields" . . . Local stocks reaching 12-month highs last week include Danaher, General Motors, Medimmune and North American Vaccine. Adams Express, Mercantile Bankshares (split) and Marriott International dipped to yearly lows . . . National Business Employment Weekly, Nov. 19-25 issue, on newsstands this week, runs a good story, "Holiday Search Tips to End the Year Productively" ("Job-seekers who make every day count -- even December 24 and 31 -- hold the advantage . . . Executives who travel all year often stay put for the holidays . . . Most organizations use calendar-year budgets, so if a position has been budgeted for, decision-makers may be receptive to your proposals before year-end.")

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