COMMENTARY

Does it get any better than this? Buoyed by excellent second-quarter profit

reports and a bond-market rally, the Dow industrials sailed past 8000 on July

16 to close at a record 8039. That's over a 1,000-point gain since Apr. 30. The

Standard & Poor's 500-stock index jumped to a new high as well. The steamiest

action was in the over-the-counter market. Led by high-tech giants Intel and

Microsoft, the NASDAQ Composite gained 6.3% for the week. Bond prices rose as

investors cheered the Labor Dept.'s report that consumer prices rose only 0.1%

in June.

STOCKS

      
                                             % change
      U.S. MARKETS               Latest    Week    Year
      Dow Jones Industrials      8038.9    2.5     50.0
      NASDAQ Combined Composite  1580.6    6.3     50.0
      S&P MidCap 400              306.5    4.0     41.9
      S&P SmallCap 600            169.1    3.6     39.1
      S&P SuperComposite 1500     200.3    3.3     47.9
      
                                                % change
      SECTORS                         Latest  Week    Year
      Bloomberg Information Age       297.3   6.8     58.4
      S&P Financials                  105.3   2.1     65.0
      S&P Utilities                   202.0   0.9      5.5
      PSE Technology                  323.2   7.1     76.8
      
                                            % change
      FOREIGN MARKETS           Latest    Week    Year
      London (FT-SE 100)        4964.2     4.2     36.7
      Frankfurt (DAX)           4201.2     3.6     70.1
      Tokyo (NIKKEI 225)      20,358.7     3.4     -4.9
      Hong Kong (Hang Seng)   15,446.0     5.0     45.3
      Toronto (TSE 300)         6744.8     2.6     37.1
      Mexico City (IPC)         4787.4    -1.0     62.6
      
                                                       Week       Year
      FUNDAMENTALS                           Latest     ago       ago
      S&P 500 Dividend Yield                  1.62 %    1.63 %    2.26 %
      S&P 500 P/E Ratio (Last 12 mos.)        23.5      23.3      18.7
      S&P 500 P/E Ratio (Next 12 mos.)*       18.8      18.6      NA
      First Call Earnings Surprise*           1.87 %    4.01 %    NA
      
                                                       Week
      TECHNICAL INDICATORS               Latest        ago      Reading
      S&P 500 200-day average             784.2        778.4    Positive
      Stocks above 200-day average        80.0 %       80.0 %   Negative
      Options: Put/call ratio             0.45         0.49     Negative
      Insiders: Vickers Sell/buy ratio    2.42         2.02     Neutral
      
      BEST-PERFORMING         Last                           Last 12
      GROUPS                 month%                          months%
      Trucking                28.2    Semiconductors          131.8
      Oil & Gas Drilling      22.5    Trucking                123.8
      Communications Equip.   21.7    Savings & Loans         106.0
      Semiconductors          21.5    Computer Systems        104.4
      Computer Systems        19.4    Invest. Banking/Brkrge. 103.3
      
      WORST-PERFORMING           Last                          Last 12
      GROUPS                     month%                        months%
      Photography/Imaging       -14.5    Gold Mining            -22.8
      Gold Mining               -11.0    Photography & Imaging   -3.3
      Metal & Glass Containers   -9.6    Engineering & Constr.   -0.5
      Hospital Management        -6.8    Electric Companies       1.1
      Oil Exploration & Prod.    -5.8    Manufactured Housing     2.1
      
      BLOOMBERG MONEY FLOW ANALYSIS
      Rebound ahead?  Stocks with most                  1-month
      significant buying on price weakness    Price      change
      Telebras-ADR                           135         -5 1/2
      Wells Fargo                            267         -16 1/4
      Chevron                                 76 5/8     - 1/4
      Amoco                                   90         -1 1/2
      Bell Atlantic                           72 1/8     - 5 1/8
      Ameritech                               68 1/4     - 1 1/8
      Intel                                   80 29/32     7 9/32
      Microsoft                              138 15/32     6 27/32
      Dell Computer                          141 7/16      26 1/16
      Ascend Communications                   53 7/8       11 1/2
      Pfizer                                  61 1/2       5 5/16
      Boeing                                  58 1/16      3/16
      
      INTEREST RATES
      
                                      Latest  Week    Year
      KEY RATES                       week%   ago%    ago%
      MONEY MARKET FUNDS              5.16    5.17    4.95
      90-DAY TREASURY BILLS           5.18    5.11    5.27
      6-MONTH BANK CDS                5.18    5.18    5.03
      1-YEAR TREASURY BILLS           5.49    5.53    5.77
      10-YEAR TREASURY NOTES          6.18    6.25    6.84
      30-YEAR TREASURY BONDS          6.47    6.56    7.03
      LONG-TERM AA INDUSTRIALS        6.94    7.02    7.54
      LONG-TERM BBB INDUSTRIALS       7.32    7.40    7.98
      LONG-TERM AA TELEPHONES         7.18    7.31    7.87
      
      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     4.61%   4.68%   5.18%   5.25%
      PERCENT OF TREASURIES   74.58   74.93   80.00   80.04
      TAXABLE EQUIVALENT      6.68    6.78    7.51    7.61
      INSURED REVENUE BONDS   4.72    4.78    5.37    5.43
      PERCENT OF TREASURIES   76.36   76.54   82.93   82.78
      TAXABLE EQUIVALENT      6.84    6.93    7.78    7.87
      
      MUTUAL FUNDS
      
      EQUITY FUNDS
      Leaders                           Laggards
      Four-week total return     %      Four-week total return         %
      Amerindo Technology D     24.4    Gabelli Gold                -21.7
      Van Wagoner Mid-Cap       17.7    Bull & Bear Gold Investors  -19.3
      Jundt US Emerging Gr. B   17.4    Midas                       -19.2
      Van Wagoner Post-Venture  17.0    Van Eck Gold Opport. A      -18.5
      Van Wagoner Emerging Gr.  17.0    Invesco Strategic Gold      -18.2
      
      Leaders                              Laggards
      52-week total return          %      52-week total return         %
      Lexington Troika Russia     104.7    United Svcs. Gold Shares    -49.5
      Fidelity Select Electronics  97.2    Bull & Bear Gold Investors  -44.3
      Pioneer Growth A             79.4    Morgan Stan. Inst. Gold A   -42.6
      Northern Technology          78.9    Lexington Strategic Invmts  -40.5
      Rydex OTC                    77.1    Midas                       -38.5
      
      EQUITY FUND CATEGORIES
      Leaders                              Laggards
      Four-week total return        %      Four-week total return       %
      Technology           10.6     Precious Metals           -14.0
      Small-cap Growth      7.2     Japan                     - 1.1
      Mid-cap Growth        6.4     Diversified Pacific/Asia    0.0
      Large-cap Growth      5.8     Natural Resources           1.0
      Small-cap Blend       5.4     Latin America               1.8
      
      Leaders                       Laggards
      52-week total return    %     52-week total return         %
      Financial             55.2    Precious Metals            -30.6
      Technology            52.3    Japan                       -3.8
      Large-cap Growth      45.6    Diversified Pacific/Asia     6.4
      Large-cap Blend       43.2    Pacific/Asia ex-Japan       11.1
      Latin America         42.0    Utilities                   18.6
      
      All data are as of market close Wednesday, July 16, 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 July 15. 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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