Thursday, April 22, 1999

IBM powers the Dow higher and inspires a rally in the Nasdaq; a Swiss plan to supply free heroin to jailed drug addicts gains critical acclaim.
Publish date:



Nasdaq Composite Index

wasn't the only tech-heavy index around today. Fresh off last night's red-hot earnings report (see below),


(IBM) - Get Report

single-handedly kept the

Dow Jones Industrial Average

solidly higher for most of the day. Big Blue's good vibes spread out a bit late in the day, and the Dow closed up 145.76 to 10727.18. But as in the days before the short-lived Great Cyclical Revolt of 1999, the Nasdaq was the day's main attraction, advancing 71.92 to 2561.00 on the IBM-inspired technology rally.

Other major indices also soared. The

S&P 500

gained 22.70 to 1358.82, the small-cap

Russell 2000

picked up 2.27 to close at 428.84, and surging Net stocks raised the roof on Internet Sector

23.26 to 659.31.

Federal Reserve


Alan Greenspan

appeared before a

Senate Banking Committee

panel along with Deputy Treasury Secretary

Lawrence Summers

to discuss the prospects of Latin American countries' adoption of the dollar as their own currency. Greenspan stressed the primacy of U.S. interests in any dollarization scheme, agreeing with Summers that the U.S. would welcome dollarization to the extent that it promoted economic stability in Latin America, but adding that "our basic monetary policy does not take into consideration what is going on in the rest of the world."

Major European bourses finished mainly higher, with London's

FTSE 100

gaining more than 1.6%. Asian markets skyrocketed overnight; Hong Kong's

Hang Seng

swelled 389.78 to 12,933.54, and Japan's


rose 170.86 to 16,665.88.

For more markets action and news, click





said it plans to sell more than 10 non-strategic businesses in 1999, including coupon book maker

Entertainment Publications

. Cendant, whose 1998 blowup was recently

revisited by

, last night reported first-quarter earnings of 22 cents a share, beating the seven-analyst estimate of 19 cents and equaling last year's figure.

Polymer and aerospace parts maker



is buying the latex floor care business of

Morton International


. GenCorp did not disclose the deal's terms.

Industrial management firm

U.S. Industries

(USI) - Get Report

today upped its $100 million share repurchase program, which the company said is virtually completed, by another $100 million.




said it plans to sell its supplemental education group, which includes such classroom products as

Facts on File


Weekly Reader


World Almanac




yesterday announced the resignation of President and COO Richard Nanula, one year after he left his position as CFO of

Walt Disney

(DIS) - Get Report


For more news on companies and stocks, click



Shares of IBM soared overnight after the company

reported first-quarter earnings of $1.55 a share, bludgeoning the 20-analyst estimate of $1.41 and up from the previous year's $1.06. IBM closed up 23 1/16 to 194 15/16.



no longer wants to think small. The company set plans to sell its U.S. small business sales unit, including about 2,000 employees and 700,000 customers, to a newly formed company headed by Susan Mandl, currently president and CEO of

Newcourt Communications Finance


For more tech news and commentary, click


General News


Labor Department

released figures showing initial jobless claims at 314,000 for the week ended April 17, down 5,000 from the previous week.

U.S. and Chinese trade negotiators met today in Beijing to begin the final round of talks regarding China's entry to the

World Trade Organization

. Chinese Premier

Zhu Rongji


President Clinton

have resolved to cut a deal by June.


air campaign against Yugoslavia continues, with the latest round of attacks destroying one of President

Slobodan Milosevic's

two Belgrade homes.


It's official: White knight

Deutsche Telekom

(DT) - Get Report

is buying

Telecom Italia


for about $90.6 billion in stock and assumed debt. The bid awaits approval by shareholders and European and U.S. regulatory authorities.

In other international telecom news,


(T) - Get Report


British Telecommunications


are expected to announce today that they will acquire a 30% stake in

Japan Telecom

, according to the

Nihon Keizai Shimbun

and the

Financial Times


National Semiconductor


is laying off 165 workers, or 10% of the total staff, at its Singapore plant.

For more international news and commentary, click



The South China Morning Post

reports that a Swiss plan to supply free heroin to jailed drug addicts at Schoengruen prison has been declared a huge success by its sponsors, who note the almost total disappearance of prison crime since the plan's inception. U.S. prison authorities can't help but be impressed, but unease over the state sanctioning of drug use will likely lead them to explore other ways of encouraging inmates to spend hours at a time in nonthreatening fetal positions.

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