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Stocks Get Boost From ‘Santa Claus Effect’

Wed., Dec. 27, 1995

Blue chip stocks got a boost from traditional year-end buying Tuesday and the stock market rose, but not everyone got the benefits of the Santa Claus effect.

Technology shares were mixed. Retailers headed downward as sales figures from the mostly depressing Christmas season filtered in.

The Dow Jones industrial average rose 12.29 points to close at 5,110.26.

Advancing issues outnumbered decliners by about 9 to 8 on the New York Stock Exchange.

Big Board volume totaled a light 217.04 million shares as of 4 p.m., down from Friday’s 289.61 million.

The stock market has risen in the final week of the year in 32 of the past 42 years, reports Yale Hirsch’s Stock Traders Almanac. The trend, dubbed the Santa Clause effect, continued Tuesday.

“You’ve got steady buying in the blue chips,” said Robert Stovall, president of Stovall-Twenty-First Advisers in New York. “Institutions are still buying some of the winners of 1995 as window trimming to make their lists look a little better.”

Some of the stocks that moved substantially or traded heavily Tuesday:

NYSE

Pier 1 Imports, down 1-1/2 to 10-1/2.

The Fort Worth, Texas, specialty retailer said it would incur a one-time loss of $20 million due to a financial consultant’s inappropriate trading activities with company cash.

Nucor Corp., up 1-1/8 to 53-7/8.

The Charlotte, N.C.-based steel company was upgraded by Salomon Brothers to “buy” from “hold.” The brokerage cited a recent price increase and noted Nucor is a price trend leader. Other steel companies were higher.

Coca Cola, up 2-5/8 to 74-5/8.

The beverage maker, which has fallen eight points in eight trading days, rebounded. The company last week made disappointing global sales projections.

NASDAQ

Cyrix Corp., down 2 to 23-1/8.

The Richardson, Texas, computer chip maker predicted a fourth-quarter loss of more than 40 cents a share. Heavy price competition for its 486 class chips was cited.

AMEX

Epitope Inc., up 4-1/2 to 17-7/8.

SmithKline Beecham PLC, up 1/8 to 54-1/2.

The Beaverton, Ore., biotechnology company said it received notice from regulators that its latest AIDS virus test device using saliva instead of blood will probably be approved. The new test is designed to confirm test results gotten from a preliminary saliva test Epitope already makes. SmithKline Beecham PLC, markets the device, called OraSure.



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