COMMENTARY

Investors went bargain-hunting during a tumultuous week. Stocks slumped after Intel Corp. warned that first-quarter earnings would be below analysts' expectations. The next day, Compaq chimed in with similar news. This time around, however, investors responded to the market's dip by pursuing companies seen as market laggards. The Dow Jones industrial average closed above 8600 for the first time on Mar. 10 and ended the week at 8675.8. The Standard & Poor's 500-stock index gained 2.0%, at 1068.5. The NASDAQ composite fell just 0.2%.

                                                % change
      U.S. MARKETS                    Latest       Week      Year
      Dow Jones Industrials           8675.8       1.6       23.2
      NASDAQ Combined Composite       1756.9      -0.2       34.7
      S&P MidCap 400                   360.2       1.8       35.4
      S&P SmallCap 600                 195.5       0.9       33.1
      S&P SuperComposite 1500          229.3       1.9       33.1
      
                                                  % change
      SECTORS                      Latest      Week      Year
      Bloomberg Information Age     319.8      -1.2      34.9
      S&P Financials                129.6       3.3      36.2
      S&P Utilities                 237.5       1.8      22.3
      PSE Technology                331.6      -0.5      29.3
      
                                                % change
      FOREIGN MARKETS            Latest     Week        Year
      London (FT-SE 100)         5829.8      1.7        31.8
      Frankfurt (DAX)            4832.8      2.6        41.5
      Tokyo (NIKKEI 225)       16,756.1     -2.0        -7.8
      Hong Kong (Hang Seng)    11,118.8     -2.0       -15.2
      Toronto (TSE 300)          7345.8      2.8        17.4
      Mexico City (IPC)          4742.3     -1.3        26.2
      
                                                      Week       Year
      FUNDAMENTALS                         Latest     ago         ago
      S&P 500 Dividend Yield                1.44 %    1.45 %      1.81 %
      S&P 500 P/E Ratio (Last 12 mos.)      26.5      26.4        21.4
      S&P 500 P/E Ratio (Next 12 mos.)*     20.9      20.5        17.1
      First Call Earnings Revision*        -3.88 %   -2.49 %     -0.93 %
      
                                                         Week
      TECHNICAL INDICATORS                   Latest       ago       Reading
      S&P 500 200-day average                945.6       940.2      Positive
      Stocks above 200-day average            67.0 %      68.0 %    Neutral
      Options: Put/call ratio                 0.57        0.50      Negative
      Insiders: Vickers Sell/buy ratio        1.69        1.61      Positive
      
      BEST-PERFORMING            Last                                Last 12
      GROUPS                    month%                               months%
      HMOs                       22.2     Specialty Appar. Retailers    83.7
      Genl. Merchandise Chains   16.9     Broadcasting                  82.1
      Shoes                      16.3     Homebuilding                  80.6
      Building Materials         15.8     Airlines                      74.3
      Engineering & Constr.      15.1     Manufactured Housing          73.2
      WORST-PERFORMING           Last                                  Last 12
      GROUPS                     month%                                months%
      Semiconductors             -9.5     Metals                       -39.2
      Computer Systems           -6.1     Gold Mining                  -33.4
      Photography/Imaging        -4.4     Shoes                        -29.2
      Oil & Gas Drilling         -1.3     Photography/Imaging          -27.2
      Aluminum                   -1.2     Engineering & Constr.        -24.7
      
      BLOOMBERG MONEY FLOW ANALYSIS
      Rebound ahead?  Stocks with most                        1-month
      significant buying on price weakness    Price           change
      IBM                                     97 1/2            -5 3/16
      Micron Technology                       34                -3 3/8
      MCI Communications                      46                -2 3/16
      Texas Instruments                       53                -3 3/8
      Wells Fargo                            321                -6 1/8
      Sun Microsystems                        42 7/16           -3 5/8
      Decline ahead?  Stocks with most                          1-month
      significant selling on price strength   Price             change
      Microsoft                               81 1/2             2 1/32
      Dell Computer                           65 3/16           10 1/16
      WorldCom                                37 7/8               1/16
      Pfizer                                  87 7/8             4 3/16
      PeopleSoft                              48 5/16            5 15/16
      Qwest Communications Intl.              37                 1 1/4
      Data: Bloomberg Financial Markets; *First Call Corp.
      
                                    Latest       Week          Year
      KEY RATES                     week%        ago%          ago%
      MONEY MARKET FUNDS             5.13         5.13         4.95
      90-DAY TREASURY BILLS          5.07         5.19         5.21
      6-MONTH BANK CDS               5.08         5.06         5.03
      1-YEAR TREASURY BILLS          5.34         5.43         5.71
      10-YEAR TREASURY NOTES         5.63         5.76         6.60
      30-YEAR TREASURY BONDS         5.94         6.05         6.87
      LONG-TERM AA INDUSTRIALS       6.51         6.65         7.38
      LONG-TERM BBB INDUSTRIALS      6.98         7.08         7.71
      LONG-TERM AA TELEPHONES        6.82         6.95         7.55
      
      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        4.44%   4.43%       5.04%    5.02%
      PERCENT OF TREASURIES     78.86   77.05       84.89    83.10
      TAXABLE EQUIVALENT         6.43    6.42        7.30     7.28
      INSURED REVENUE BONDS      4.58    4.59        5.24     5.24
      PERCENT OF TREASURIES     81.35   79.83       88.26    86.74
      TAXABLE EQUIVALENT         6.64    6.65        7.59     7.59
      
      EQUITY FUNDS
      Leaders                                  Laggards
      Four-week total return          %        Four-week total return         %
      Lexington Troika Russia        12.8      Lexington Strat. Invmnts.   -10.9
      Fidelity Sel. Medical Del.     10.6      Oppenheimer Real Asset B     -9.3
      Safeco Small Co. Stk. NoLd.    10.6      Lexington Strat. Silver      -9.2
      Firstar MicroCap Instl.        10.4      American Heritage            -8.9
      Yacktman Focused               10.0      U.S. Global Investors Gold   -7.1
      Leaders                                  Laggards
      52-week total return            %        52-week total return          %
      Munder Micro-Cap Eqty. Y       69.4      Midas                       -60.8
      Delaware Aggressive Gr. A      69.4      U.S. Global Investors Gold  -60.0
      MFS Strategic Growth I         59.8      Bull & Bear Gold Investors  -58.1
      Fidelity Select Air Trans.     58.2      Invesco Strategic Gold      -57.6
      MFS Mass. Inv. Grth. Stk. A    56.9      Merrill Emerging Tigers B   -51.1
      
      EQUITY FUND CATEGORIES
      Leaders                                  Laggards
      Four-week total return          %        Four-week total return         %
      Europe                          7.0      Japan                        -3.3
      Communications                  6.3      Precious Metals              -2.9
      Unaligned                       5.6      Real Estate                  -2.4
      Financial                       5.2      Diversified Pacific/Asia     -2.2
      Large-cap Value                 4.5      Pacific/Asia ex-Japan        -0.7
      Leaders                                  Laggards
      52-week total return            %        52-week total return          %
      Communications                 40.2      Precious Metals             -41.7
      Financial                      37.1      Pacific/Asia ex-Japan       -35.8
      Unaligned                      33.0      Diversified Pacific/Asia    -24.7
      Large-cap Growth               31.5      Diversified Emerging Mkts.  -12.8
      Small-cap Value                30.3      Japan                        -6.6
      
      All data are as of market close Wednesday, Mar. 11, 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 Mar. 10. For a more detailed explanation, write to us or E-mail
      figures@businessweek.com.  NA=Not available  **Vanguard Index 500 Fund
      Data: Morningstar, Inc.
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