Soaring Dow Leaves Technology Behind
Stocks rallied again Monday as bond prices continued to firm, calming interest-rate worries. The Dow Jones industrial average flirted with a new record, before closing up 63.59 at 5,600.15.
Most broad-market indexes rose. But the Nasdaq composite fell 1.20 to 1,084.88 as key technology issues continued to struggle.
“The technology group remains a little wounded and suspect, but this is still a market where money that’s pulled out of one area still wants to go someplace else,” said Eric Miller, chief strategist for Donaldson, Lufkin & Jenrette Securities in San Francisco.
Advancing issues outnumbered decliners by more than 2 to 1 on the New York Stock Exchange, where volume totaled 417.24 million shares as of 4 p.m., well below Friday’s pace.
Some of the stocks that moved substantially or traded heavily:
NYSE
Compaq Computer, down 1-3/4 to 40
The leading maker of PCs roiled the technology sector Friday with a move to sacrifice profits in an effort to grow faster, signaling a price battle that could severely hurt rivals. Compaq said it would trim its profit margin for the first half of 1995, cutting prices to meet an internal sales target.
Kmart, down 1/8 to 7-1/2
The troubled discount retailer finalized a deal Friday with its creditors, eliminating the possibility it would have to immediately pay back $550 million in debts if the company’s credit rating is downgraded to junk status. But the agreement also will cause a quarterly loss for Kmart.
Alumax, down 2-3/4 to 33-1/2
Rather than pursue a potentially nasty battle to gain control of Alumax, Kaiser Aluminum withdrew on Saturday its buyout offer of up to $2.5 billion in cash and stock. Kaiser offered early last month to pay between $40 and $45 for each of Alumax’s 55 million shares.
Infinity Broadcasting, up 1-1/2 to 43-3/8
The nation’s biggest independent radio company said it is buying a dozen stations in five markets for $410 million in cash. The acquisition gives Infinity new stations in Dallas, Boston, Atlanta and Baltimore, where it already has a presence. It will also get its first three stations in the Orlando, Fla., market.
NASDAQ
Inhale Therapeutic Systems, up 4-1/2 to 16-3/4
Baxter International will invest about $80 million in the company as part of a drug collaboration. The two companies initially will use Inhale’s dry-powder inhaler technology to develop four drugs. Baxter initially will acquire about 12 percent of Inhale’s stock for $20 million and provide $60 million in research funding and milestone payments. It has options to invest $55 million more, bringing the potential total investment to $135 million.
Weitek, down 1-1/4 to 1-1/2
The chip maker announced Friday evening that it expects a significant first-quarter loss.