Dow Begins New Year With 60-Point Surge

Stock investors searching for a hint of the future often look to January as a bellwether for the rest of the year.

If the first trading day of 1996 was any indication, they had reason to smile.

Stocks rose strongly Tuesday, led by blue chips and cyclical shares that track the the economy.

The Dow Jones industrial average, which soared more than 33 percent last year, rose 60.33 points Tuesday to 5,177.45.

Advancing issues outnumbered decliners by about 7 to 4 on the New York Stock Exchange

Big Board volume totaled 364.15 million shares as of 4 p.m., vs. 319.69 million on Friday.

Enthusiasm for stocks by the general public appeared unabated, said Ricky Harrington, senior vice president at Interstate-Johnson Lane in Charlotte, N.C.

“The public is coming into this market with both feet by way of mutual funds, IRAs and 401(k)s,” he said.

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

NYSE

AT&T, up 2-1/2 to 67-1/4.

The company said it will eliminate nearly 40,000 jobs, mostly through layoffs, as part of its sweeping plan to split into three separate telecommunications and computer companies.

Sears Roebuck, up 1-1/2 to 40-1/2.

Merrill Lynch raised its intermediate-term and long-term ratings on the retailer to “buy” from “above average” and raised its earnings estimates, saying Sears had a good Christmas season despite industry weakness.

Federated Department Stores Inc., up 1-1/2 to 28-3/4.

Smith Barney began coverage of the Cincinnatibased owner of Macy’s, Bloomingdale’s and Bon Marche department stores with a “buy” rating.

Silicon Graphics, down 4-5/8 to 23.

The Mountain View, Calif., maker of high-powered personal computers said its second-quarter profits would be down 4 cents from the year earlier to 30 cents per share due to slower than expected growth.

Toys “R” Us, up 2-1/8 to 23-7/8.

The Paramus, N.J., toy retailer reported a 7 percent gain in holiday sales for the eight weeks ending Dec. 24.

NASDAQ

Gymboree Corp., down 2-1/8 to 18-1/2.

The Burlingame, Calif., maker of childrens’ clothing was downgraded to “underperformer” from “hold” by NatWest Securities.

AMEX

Incyte Pharmaceuticals, up 3-1/8 to 28-1/8.

The Palo Alto, Calif., biotechnology company signed an agreement with Johnson & Johnson allowing use of Incyte’s database of genes to develop drugs.