Stocks Climb Despite Higher Rates

Stocks ended mostly higher on Wednesday, after the Federal Reserve raised shortterm interest rates and said the economy may not be finished expanding.

The Dow Jones industrial average added 3.70 to 3,847.56.

The blue chip index rose as much as 26 points early in the session in anticipation of the Fed’s action. It reversed field, backing off as much as 10 points with bonds, as relieved investors took profits immediately following the Fed’s tightening, but then recovered late in the day.

Stocks managed to rise despite a drop in the bond market, where the 30-year bond fell 5/8 point after advancing earlier in the day.

Bonds fell after the Fed said the economy is not showing strong signs of slowing.

Advancing issues led decliners by about 4 to 3 on the Big Board. Volume was heavy at 395.31 million shares as of 4 p.m., but below Tuesday’s very heavy volume of 409.54 million shares.

Despite strength in the overall market, the American depositary shares of Mexican companies moved lower, giving back Tuesday’s strong gains after President Clinton announced a $20 billion aid package to Mexico.

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

NYSE

Burlington Northern rose 1 3/8 to 48 7/8.

Santa Fe Pacific Corp. rose 5/8 to 18 3/8.

Union Pacific rose 1/4 to 50 1/2.

Union Pacific withdrew its hostile $3.6 billion bid for Santa Fe Pacific, paving the way for Burlington to complete its friendly $4 billion acquisition of Santa Fe.

Ford Motor fell 1/8 to 25 1/8.

General Motors rose 7/8 to 39 3/4.

Chrysler rose 5/8 to 45 1/2.

Auto stocks rallied after Ford reported record earnings for 1994, up to $4.97 per share from $2.27 per share, in 1993. In the fourth quarter, Ford earned $1.6 billion, or $1.47 a share, more than double its profit of $719 million, or 65 cents a share, a year ago.

NASDAQ

Amgen fell 1 5/8 to 62.

The biotechnology company reported after the stock market closed that its fourth-quarter operating income was 3 cents per share, after a write-off for its acquisition of Synergen, down from 64 cents a year ago. Revenues increased 21 percent.

AMEX

Charter Medical, unchanged at 15 1/2.

The hospital operator’s firstquarter net income was 1 cent per share, compared with a loss of 15 cents a year ago.