Stocks Higher; Dow Up 24.05

AP Online
05-10-1999
Stocks Higher; Dow Up 24.05

NEW YORK (AP) -- Stocks were modestly higher today as investors responded to a drop in interest rates in the bond market.

At 2 p.m. on Wall Street, the Dow was up 24.05 at 11,055.64. The blue chip index was down as much as 65 points in early trading before regaining ground. On Friday, the Dow rose 84.77 to close at 11,031.59, its second record high close for the week and the second time it finished above 11,000.

Broader stock indicators were higher after a mixed morning. The Standard & Poor's 500 index was up 1.14 at 1,346.14, and the Nasdaq composite index was up 22.28 at 2,525.90, largely on the strength of Internet stocks.

Bond prices rose after Yugoslavia's army announced a partial withdrawal of military and police forces from Kosovo. The 30-year Treasury bond was up ] point, while its yield fell to 5.78 percent from 5.81 percent late Wednesday.

Last week, worries about interest rates prompted stock market investors to sell. Higher rates usually means lower corporate profits.

Meanwhile, merger news moved some stocks. HSBC Holdings PLC is buying Republic National Bank of New York and an affiliated banking company for about $10.3 billion in cash. Under the agreement, HSBC will pay $72 a share for Republic New York Corp. and Safra Republic Holdings SA. Republic's stock was down 1~ at 68[.

And Chevron Corp. is discussing a purchase of Texaco Inc. for about $42 billion in stock, The Wall Street Journal reported today. The newspaper, citing unidentified people familiar with the talks, said the companies are not close to an agreement and that a combination faces enormous hurdles. Chevron, a Dow stock, was up { at 95], while Texaco rose ] to 67|.

Internet stocks were higher on reports that USA Networks will abandon its bid to acquire Lycos after concluding it can't win approval from Lycos shareholders. Lycos stock was up 9{ at 99, and USA Networks were down { at 34~. Shares of CMGI Inc., a holding company that has about a 20 percent stake in Lycos, was up 11\ at 232{.

In economic news, two manufacturing groups jointly reported that spending on machine tools in March rose 44 percent from the previous month, but declined 48 percent from a year earlier.

Analysts consider demand for machine tools a reliable indicator of the strength of the manufacturing sector and the overall economy. Don F. Carlson, president of the Association for Manufacturing Technology, said his group expects stronger results in the second half of this year.

Advancing issues led decliners by 7 to 5 on the New York Stock Exchange, where volume came to 523.8 million shares, down from Friday's pace.

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