COMMENTARY

Stocks really took it on the chin this week, suffering from the double whammy

of inflation fears and less-than-robust earnings. The Dow industrials tumbled

363 points, or 5.3%, while the Standard & Poor's 500-stock index sank 5.1%. For

the year so far, those two large-cap indexes are ahead just a bit more than 1%,

after sporting almost double-digit gains less than a month ago. The performance

of the tech-laden NASDAQ index has been far worse---down 7% for the year. Gold

stocks were rocked by the Bre-X scandal, and so were gold mutual funds.

      
                                                        % change
      U.S. MARKETS                           Latest    Week    Year
      Dow Jones Industrials                  6517.0    -5.3    14.9
      NASDAQ Combined Composite              1201.0    -5.4    8.1
      S&P MidCap 400                         249.1     -4.7    7.3
      S&P SmallCap 600                       135.2     -4.2    5.1
      S&P SuperComposite 1500                160.6     -5.0    13.3
      
                                                          % change
      SECTORS                                 Latest   Week    Year
      Bloomberg Information Age               223.9    -5.5    12.1
      S&P Financials                          84.3     -7.2    23.5
      S&P Utilities                           188.6    -2.5    -3.0
      PSE Technology                          238.1    -5.3    17.9
      
                                                         % change
      FOREIGN MARKETS                        Latest    Week    Year
      London (FT-SE 100)                     4236.6    -1.5     13.6
      Frankfurt (DAX)                        3301.9    -3.4     32.0
      Tokyo (NIKKEI 225)                     18,037.3  -2.4    -16.5
      Hong Kong (Hang Seng)                  12,136.3  -5.0     8.9
      Toronto (TSE 300)                      5849.1    -4.5     16.4
      Mexico City (IPC)                      3716.2    -3.3     20.8
      
                                                        Week    Year
      FUNDAMENTALS                            Latest    ago      ago
      S&P 500 Dividend Yield                  1.94%     1.86%    2.13%
      S&P 500 P/E Ratio (Last 12 mos.)        19.9      20.7     19.3
      S&P 500 P/E Ratio (Next 12 mos.)*       15.9      16.6     NA
      First Call Earnings Surprise*           2.41%     NA       NA
      
                                                      Week
      TECHNICAL INDICATORS                    Latest   ago      Reading
      S&P 500 200-day average                 720.0   717.9     Positive
      Stocks above 200-day average            56.0%   64.0%     Neutral
      Options: Put/call ratio                 0.69    0.69      Neutral
      Insiders: Vickers Sell/buy ratio        2.04    1.94      Neutral
      
      BEST-PERFORMING          Last                           Last 12
      GROUPS                  month%                           months%
      Oil & Gas Drilling      11.4    Semiconductors          78.1
      Trucking                9.3     Oil & Gas Drilling      56.1
      Restaurants             9.3     Shoes                   51.7
      Newspaper Publishing    4.8     Savings & Loans         44.4
      Oil-Well Equip. & Svcs. 3.4     Household Products      33.7
      
      WORST-PERFORMING         Last                            Last 12
      GROUPS                  month%                           months%
      Hospital Management     -21.2   Gold Mining             -26.7
      Photography/Imaging     -17.7   Machine Tools           -26.5
      Tobacco                 -14.5   Engineering & Constr.   -23.4
      Gold Mining             -14.2   Broadcasting            -20.5
      Engineering & Constr.   -14.0   Steel                   -14.7
      
      BLOOMBERG MONEY FLOW ANALYSIS
      Rebound ahead?  Stocks with most                       1-month
      significant buying on price weakness        Price       change
      IBM                                         136 3/4     -8 3/8
      Texas Instruments                           75 1/4      -4 3/4
      General Electric                            98 5/8      -4 3/4
      Citicorp                                    112 1/8     -5 1/2
      Compaq Computer                             74 3/4      -5 3/8
      3M                                          85 5/8      -6 7/8
      
      Decline ahead?  Stocks with most                        1-month
      significant selling on price strength       Price       change
      Royal Dutch Petroleum                       174 3/8      3 3/4
      ADC Telecommunications                      28 1/8         3/8
      PacifiCare Health Systems                   83 3/4         11/16
      ASM Lithography Holding                     73           6 3/8
      Monsanto                                    37 3/4         1/8
      Zitel                                       29 3/4         3/4
      
      INTEREST RATES
      
                                              Latest  Week    Year
      KEY RATES                               week%   ago%    ago%
      MONEY MARKET FUNDS                      5.01    4.96    4.86
      90-DAY TREASURY BILLS                   5.28    5.44    5.20
      6-MONTH BANK CDS                        5.13    5.07    4.86
      1-YEAR TREASURY BILLS                   5.95    5.91    5.41
      10-YEAR TREASURY NOTES                  6.85    6.75    6.31
      30-YEAR TREASURY BONDS                  7.07    6.95    6.66
      LONG-TERM AA INDUSTRIALS                7.57    7.45    7.22
      LONG-TERM BBB INDUSTRIALS               7.94    7.79    7.62
      LONG-TERM AA TELEPHONES                 7.76    7.65    7.48
      
      BLOOMBERG MUNI YIELD EQUIVALENTS
      Taxable equivalent yields on AAA-rated, tax-exempt municipal bonds,
      assuming a 31% federal tax rate.
                               10-yr.  bond     30-yr. bond
                               Latest  Last    Latest  Last
                               week    week    week    week
      GENERAL OBLIGATIONS     5.07%   4.99%   5.63%   5.59%
      PERCENT OF TREASURIES   73.94   73.68   79.63   80.13
      TAXABLE EQUIVALENT      7.35    7.23    8.16    8.10
      INSURED REVENUE BONDS   5.24    5.14    5.89    5.86
      PERCENT OF TREASURIES   76.42   75.89   83.31   84.00
      TAXABLE EQUIVALENT      7.59    7.45    8.54    8.49
      
      MUTUAL FUNDS
      
      EQUITY FUNDS
      Leaders                              Laggards
      Four-week total return          %    Four-week total return       %
      Prudent Bear                   6.7   IDS Precious Metals B       -17.6
      Fidelity Sel. Energy Serv.     4.8   Morgan Stanley Inst. Gold A -16.8
      Rydex Ursa                     4.7   Invesco Strategic Gold      -16.0
      Caldwell & Orkin Mkt. Opp.     4.5   Midas                       -15.9
      Tocqueville Intl. Value        4.2   First Amer. Technology B    -15.6
      
      Leaders                                Laggards
      52-week total return              %    52-week total return         %
      Vontobel Eastern Europ. Eq.     56.2   Steadman Technology Grth. -42.0
      Morgan Stan. Inst. Lat. Am. A   47.4   United Svcs. Gold Shares  -41.1
      Morgan Stanley Latin Amer. A    46.1   DFA Japanese Small Co.    -39.2
      Delaware Pooled Real Estate     43.2   Fidelity Japan Small Co.  -35.2
      State St. Res. Glob. Res. A     41.8   Matthews Korea            -34.1
      
      EQUITY FUND CATEGORIES
      Leaders                                Laggards
      Four-week total return            %    Four-week total return     %
      Europe                          -0.4   Precious Metals           -11.3
      Japan                           -0.8   Technology                -9.0
      Latin America                   -1.4   Small-cap Growth          -8.4
      Foreign                         -1.4   Health                    -7.1
      Real Estate                     -1.7   Mid-cap Growth            -7.1
      
      Leaders                                Laggards
      52-week total return              %    52-week total return        %
      Real Estate                     31.3   Precious Metals          -20.1
      Latin America                   29.1   Japan                    -19.0
      Financial                       24.5   Diversified Pacific/Asia -4.9
      Europe                          18.5   Small-cap Growth         -4.6
      Large-cap Value                 14.9   Communications           -1.2
      
      All data are as of market close Wednesday, Apr. 2, 1997, unless otherwise 
      indicated. Industry groups include S&P 500 companies only.  Fundamentals, 
      technical indicators, Bloomberg money flow analysis, and mutual fund returns 
      are as of Apr. 1. For a more detailed explanation, write to us or E-mail 
      figures@businessweek.com  NA=Not available  **Vanguard Index 500 Fund
      
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