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MARKET SAVVY

Wall St. Follows Dollar Lower; Japan Gets a Lift

July 20, 1999|From Times Staff and Wire Reports

U.S. stocks pulled back on Monday in thin trading as the dollar tumbled in value against the Japanese yen.

Meanwhile, Taiwan's battered stock market rocketed early today as the government sought to support prices.

Despite another batch of strong second-quarter earnings reports Wall Street ended broadly but modestly lower, after surging to record highs on Friday.

The Dow industrials eased 22.16 points to 11,187.68. The Nasdaq composite was off 1.2% and the Standard & Poor's 500 slid 0.8%.

Losers topped winners by 17 to 12 on the New York Stock Exchange.

Currency markets were where the action was on Monday: The yen staged its biggest rally against the dollar in 5 1/2 months amid a growing appetite for Japanese securities. The yen ended at 117.80 to the dollar, versus 120.98 on Friday.

Some global investors may be selling dollar-denominated assets to buy surging Japanese stocks, on optimism that Japan's economic recovery is real, analysts said.

The Nikkei-225 index jumped 1.6% on Monday to 18,532.58. It is up 33% year-to-date, compared with the Dow's 22% gain.

The euro also rose against the dollar, ended at $1.029 versus $1.020 on Friday. The euro, which had fallen as low as $1.0124 earlier, bounced higher when it climbed back to $1.020, setting off automatic buy orders, traders said.

There were more rumors that European central banks might intervene to support the euro.

In the U.S. bond market, yields ended slightly higher, possibly hurt by dollar weakness.

Meanwhile, early today in Taiwan that nation's stock market soared 5.7% after diving last week amid rising tensions between Taiwan and China. The Taiwanese government said it will support stocks. The market was up 0.3% on Monday.

Among U.S. market highlights:

* Airline stocks were mostly higher as Continental and Delta posted strong earnings. Continental class B rose $2.88 to $41.44, Delta surged $3.13 to $62.19 and Alaska Air gained $1.38 to $43.25.

* In the Dow, American Express jumped $3.31 to $139.19 and GE rose $1.13 to a record $120, but Coca-Cola fell $1.81 to $63.19 and Johnson & Johnson eased $1.56 to $95.94.

* Shares of makers of computer networking equipment fell on concern that their rocketing prices aren't justified by their near-term profit outlook. Efficient Networks tumbled $6.75 to $51.88, Paradyne Networks skidded $7.38 to $48.88, Redback Networks drooped $7 to $163 and Juniper Networks lost $7.88 to $135.

* E-Trade sank $2.81 to $34.69 despite reporting a narrower-than-expected loss of 10 cents a share, as the online brokerage said trading growth slowed. Charles Schwab dropped $2.94 to $49.50 and Ameritrade Holding lost $2.50 to $31.75.

*

Market Roundup, C12

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