Stocks Rise, But Hesitant Investors Await Fed

Stocks rose Monday, but retreated from a stronger rally as investors remained hesitant before this week’s economic reports and next week’s Federal Reserve meeting on interest rates.

The Dow Jones industrial average rose 12.56 to 5,717.79, down from an afternoon gain of about 37 points. The barometer of 30 big U.S. companies has now advanced for four straight sessions, rebounding by nearly 90 points from its recent slump on inflation and interest rate uncertainties.

“Investors are jockeying for position here. We’re going to see this mixed action until the Fed meeting,” said Bob Dickey of Dain Bosworth in Minneapolis.

A flurry of new economic readings is scheduled for this week, including reports on consumer confidence, home sales, durable goods orders, and overall economic growth.

There is considerable concern that when the Fed’s policy makers meet next Tuesday and Wednesday, they will raise short-term lending rates as a pre-emptive strike to thwart inflationary pressure.

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

NYSE

USA Waste Services, up 1 at 28-7/8.

USA Waste, the third-largest solid waste company in North America, agreed to acquire landfill operator Sanifill for about $1.6 billion in stock and assumed debt. USA Waste will pay 1.7 million of its shares for Houston-based Sanifill. The deal comes as competitor Republic Industries, which is controlled by billionaire investor H. Wayne Huizenga, has been rapidly announcing takeovers in the waste-collection industry.

Westinghouse Electric, up 3/4 at 19-7/8.

Infinity Broadcasting Class A, up 1-1/4 at 31-5/8.

The shares continued to trade actively following last week’s agreement by Westinghouse to buy Infinity for $3.9 billion in stock. The proposed deal would bring together the two biggest players in the radio-station business.

NASDAQ

Cyrix, down 5-3/4 at 16.

The company said late Friday it expects to report a loss for the second quarter due to aggressive pricing in the microprocessor market and delays in shipping new products. Most analysts had expected the chipmaker to show a profit for the current quarter.

ValuJet, up 1-5/16 at 8-15/16.

The grounded carrier could restart operations with as few as four airplanes to three or four destinations when the FAA lifts its shutdown order, airline president Lewis Jordan said. The airline was grounded June 17 by the FAA after a month-long investigation into the May 11 crash of a DC-9 in the Everglades found serious maintenance deficiencies.