Stocks rise as retail, oil sectors stage rally Dow up 1.08 to 5,475.14; other indexes also gain; Ericsson ADR most active

THE BALTIMORE SUN

NEW YORK -- U.S. stocks rose yesterday as Dayton Hudson Corp., Gap Inc. and other retailers said sales improved in April for a third month in a row.

Oil stocks rallied after Royal Dutch/Shell Group reported its best quarterly earnings ever.

Gains were tempered by a late-day rise in bond yields, which raised the attractiveness of fixed-income securities relative to equities. The Dow Jones industrial average closed up 1.08 to 5,475.14, after edging above 5,500 for the first time in a week.

The Standard & Poor's 500 index rose 0.66 to 645.44, and the Nasdaq composite index gained 4.39 to 1,187.82.

Among broad market indexes, the Russell 2,000, which tracks small and mid-sized companies, rose 2.45 to 347.6; the Wilshire 5,000 index, composed of companies traded on the New York, American and Nasdaq exchanges, rose 12.40 to 6,437.96; the S&P; Midcap index rose 1.74 to 234.37 and the American Stock Exchange market value index rose 2.57 to 587.21.

Advancing stocks led decliners on the New York Stock Exchange 1,336 to 992. About 404 million shares changed hands, below the average volume of 424 million shares a day so far this year.

American depositary receipts of Ericsson AB, a Swedish telecommunications company, rose 37.5 cents to $21.625 as 19.4 million shares changed hands, making it the most active stock in U.S. composite trading. Investors sought out the stock because, if they bought it yesterday, they would be paid the company's dividend.

Next most active, in descending order, were the shares of Appletree Cos., up 12.5 cents to 34.375 cents, with 15.9 million shares changing hands; Cisco Systems Inc., unchanged at $52.75 as 11 million shares traded; America Online Inc., down $5.125 to $57.625 as 10.9 million shares traded; and Morrison Knudsen, with about 10 million shares traded.

Morrison Knudsen rose $1.25 to $2.625 after the troubled construction company said it is in discussions with investors who might buy all or part of it. That was the biggest percentage gain in U.S. composite trading.

Among department store chains, Dayton Hudson rose $2.25 to $96, May climbed 50 cents to $45.75, Sears rose 12.5 to $50.75 and Gap climbed 50 cents to $30.50.

Oil shares led the S&P;'s advance after Royal Dutch/Shell, the world's biggest oil refiner, surprised analysts with a report that earnings shot up 24 percent in the first quarter. Royal Dutch Petroleum Co., which owns 60 percent of Royal Dutch/Shell, rose $5.25 to $146.625.

Other oil gainers include Mobil Corp., up $2.625 to $112.50, and Chevron Corp., up 50 cents to $57.125. Schlumberger Ltd., a drilling services company, jumped $3.25 to $87.50.

The biggest gainer among the 30-stock Dow industrials was United Technologies Corp., which rose $4.50 to $108.25 after a Morgan Stanley analyst reiterated that the defense contractor's shares were regarded as a "strong buy." The company's shares had slid 6.1 percent since April 30.

Eastman Kodak Co. slipped $2.125 to $73.75, giving up Wednesday's $2 gain.

General Electric Co. shares rose $1 to $77 after Chief Executive Jack Welch told investors and analysts that they should raise their estimates for 1996 earnings by about 5 cents a share. Wall Street had expected GE to earn $4.36 this year.

Shares of semiconductor makers fell in advance of an industry group's postponed monthly report on demand for computer chips. Micron Technology Inc. dropped $1.125 to $33.875, Teradyne Inc. fell $1.125 to $20.125 and equipment maker Applied Materials Inc. dropped 87.5 cents to $38.50. Intel Corp. slipped 12.5 to $6.625.

Apple Computer Inc. shares fell 62.5 cents to $26.125 on news that the company will repair several hundred thousand Macintosh personal computers that freeze because of faulty electronics.

Pub Date: 5/10/96

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