Dow holds to record pace, rising 15.7% since Jan. 1

Adding to last week's five-day record-setting winning streak, the Dow Jones industrial average gained 6.91 points yesterday and closed at 4,437.47. In the last four and a half months the Dow index gained 603 points, and now stands 15.7 percent above its New Year's Day level of 3,834.44.

WHAT TO DO NOW: "Stay put. For the past 10 years, a buy-and-hold policy on the S&P; 500 returned 14.4 percent per year, but if you missed the best 12 months, you'd have earned only 3.8 percent in that period. Market mis-timing can be hazardous to your wealth." (Mutual Fund News Service)


"A 20-year study shows that low price-earnings stocks do better than high P/E issues most of the time, in both bull and bear markets." (David Dreman, money manager, in Forbes, May 22)

"Wall Street is the only place that people ride to work in a Rolls-Royce to get advice from people who take the subway." (Warren Buffett)


YOUR MONEY: "Savers, it's time to lock in rates," says Kiplinger's Personal Finance magazine, June. The story adds, "Most bets are that the Federal Reserve has piloted the economy to a 'soft landing' and that short-term rate hikes are over. That means savers' rates are near their peak." The article lists Loyola Federal Savings (800-394-5900) under "5-Year Top-Yielding Certificates of Deposit."

NOTES & QUOTES: "If you go with a money manager who gives you high rates of return, you must accept big drops from time to time." (Pete DeCicco, hedge fund consultant)

The Kiplinger Washington Letter says that few banks will follow the lead of a Chicago bank which charges $3 for using a teller.

"In today's job market, a series of temporary positions on a job resume is no longer a stigma." (Black Enterprise, May)

"Dow 5,000. Don't laugh." (Headline of a Business Week, May 15, story, subtitled, "Productivity Is Up, Inflation Tamed. It Could Happen.")

BALTIMORE BITS: "Sun Stocks" recently reaching new highs include Alexander & Alexander, Annapolis Bancshares, Geico, Giant Food, HCIA Inc., Legg Mason, Lockheed Martin, Mercantile Bankshares, Storage USA, Superite, USF&G; and Youth Services International.

Ask your broker to take you ($15) to the Security Analysts' program about tax-free municipal bonds -- their yields, ratings, call provisions, maturities, etc. It is at the Stouffer Renaissance Harborplace Hotel Thursday, May 25, at 4 p.m. (Note different time.)

T. Rowe Price International Stock Fund appears under "Recommended List of Mutual Funds" in S&P; Outlook, May 3.


Call Legg Mason's Gerald Scheinker (486-8010) for a 61-page brochure, "Real Estate Investment Trusts," including specific "buy" suggestions.

TOWSON TOPICS: Robert G. Wood, Wood Capital Management, will send you his firm's creditable "Record of Investment Performance," if you call him at 296-8400. Mr. Wood writes, "Although dividend yields are the lowest in history, pay-out ratios are lower now, so companies can raise dividends if so inclined."

FREE STATE FILE: In one of Business Week's May 15 cover stories, "Corporate Scoreboard: First-Quarter Results For 900 Companies," we find these local firms listed, with "Percentage Profit Change From 1994" following each name: Baltimore Gas & Electric, minus 14 percent; Black & Decker, plus 76; Giant Food, up 12; Manor Care, ahead 20; Mid-Atlantic Medical, up 26; McCormick, plus 6; Times Mirror (parent of The Baltimore Sun Co.), up 101; USF&G;, ahead 113.

MORE MARYLAND: Charles Allmon, publisher of The Growth Stock Outlook, Chevy Chase, says, "Bristol-Myers Squibb is the largest position in our portfolio. With patience, this stock should pay off handsomely."

The stock of Bell Atlantic, the communications firm that services our area, is listed under "High Level of Current Income and Wealth Preservation" in Personal Finance, May 10.

ALONG WALL STREET: In an appearance Friday on "Wall Street Week With Louis Rukeyser," Jeffrey Vinik, portfolio manager of the $34 billion (!) Fidelity Magellan Fund (ahead 14.8 percent this year to date), made these observations:


"We're only in the third inning for high-tech stocks. . . . Many of them are selling at only 10-20 times earnings. . . . My favorites are National Semiconductor, Applied Materials, Microsoft and Intel. The latter, after a huge run-up, still isn't overpriced. . . . In other areas, I like General Motors, CSX and Merrill Lynch."