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Stocks' Rally Powers Ahead; Bond Yields Up

October 23, 1998| From Times Staff and Wire Reports

Technology and smaller stocks again paced Wall Street's gains, as the market advanced Thursday for a seventh consecutive session.

The Nasdaq composite index jumped 1.7% to 1,702.64, its highest level since Sept. 29.

The Russell 2,000 index of smaller stocks was even stronger, gaining 1.8% to 366.40.

Many blue chips, by contrast, were up about half as much. And the Dow Jones industrial average eked out a mere 13.91-point, 0.2% rise, to 8,533.14. It was weighed down by sharp declines in major oil stocks.

The market's rebound has been fueled in part by stronger-than-expected corporate earnings reports. Procter & Gamble, reporting a 10% earnings gain on Thursday, surged $3.06 to $86.88.

But the buying in technology stocks and smaller stocks has been particularly heartening for Wall Street's bulls. Smaller stocks had been beaten down relentlessly in the summer market rout.

Rising stocks outnumbered losers by a strong 24 to 16 on Nasdaq on Thursday.

Stocks' gains appear to be coming at bonds' expense: Yields rose on Thursday, with the 30-year T-bond yield ending at 5.13%, up from 5.07% on Wednesday and the highest since Sept. 28.

"Some of the flight-to-quality edge has come off the Treasury market," said Thomas Donne, who manages about $1.9 billion in bonds at Banc One Investment Advisors.

Among Thursday's highlights:

* Tech winners included Microsoft, up $3.56 to $110; Dell, up $1.94 to $58.88; Broadcom, up $6.63 to $76.25; America Online, up $6.94 to $113.94; and WinStar Communications, up $6.31 to $25.88 after it said it will receive $2 billion in phone equipment and financing from Lucent Technologies to expand its wireless phone network.

* On the downside, leading oil stocks were hammered by Chevron's downbeat profit report. Chevron slumped $5.75 to $81.50 and Exxon dove $3.81 to $71.75. But many smaller energy stocks still closed higher.

Market Roundup, C6

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