The Daily Dow
Friday, June 20, 1997
by Robert Sheard

LEXINGTON, KY. (June 20, 1997) -- A combination of options and futures expirations (the so-called Triple Witching) and bullish forecasts by much-watched analysts helped the Dow to settle comfortably around the 7,800 level after being some 40 points higher in the early afternoon, still just a sprint away from yet another round-numbered milestone.

Yesterday it was Prudential's Ralph Acampora predicting the Dow will hit 10,000 by next June, a whopping 28% gain. Today it was Abby Cohen of Goldman, Sachs moving up a market forecast. Cohen bumped her price target for the S&P 500 over the next 12 months up to 950. Given that the S&P 500 settled around 900 today, though, she's not sticking her neck out very far for a purported Bull. She's only predicting a 5% or 6% gain for the next year.

The real news today is that the State Attorneys General and the tobacco companies have hammered out a deal to settle the flood of pending lawsuits against the industry. The general agreement calls for payments of $368 billion over 25 years to establish a fund to help the states defray the healthcare costs attributable to tobacco products. In return, the tobacco companies will receive limited immunity from future litigation.

The agreement will also include much stricter regulation of marketing, advertising, and distribution practices for the industry. Even with the expected agreement, though, the plan must still wade through Congress and the President before it can go into effect. President Clinton is expected to announce a special commission to examine the agreement, to be headed by Donna Shalala, secretary of health and human services.

Tobacco stocks traded nervously today ahead of the expected news conference. Other stocks enjoying a solid day for the Dow, however, were Foolish Four component 3M <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: MMM)") else Response.Write("(NYSE: MMM)") end if %>, ALLIEDSIGNAL <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: ALD)") else Response.Write("(NYSE: ALD)") end if %>, and HEWLETT-PACKARD <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: HWP)") else Response.Write("(NYSE: HWP)") end if %>.

(c) Copyright 1997, The Motley Fool. All rights reserved. This material is for personal use only. Republication and redissemination, including posting to news groups, is expressly prohibited without the prior written consent of The Motley Fool. ________________________________

Stock  Change   Last
--------------------
T    -   5/8   37.25
GM   -   3/8   55.63
CHV  +   1/8   74.50
MMM  +2  1/4   102.13

                 Day   Month    Year
        FOOL-4   -0.15%   3.68%   4.13%
        DJIA     +0.25%   6.35%  20.91%
        S&P 500  +0.08%   5.94%  21.32%
        NASDAQ   -0.00%   3.34%  12.09%

    Rec'd   #  Security     In At       Now    Change
   1/2/97  120 3M            83.00    102.13    23.04%
   1/2/97  153 Chevron       65.00     74.50    14.62%
   1/2/97  179 Gen. Motor    55.75     55.63    -0.22%
   1/2/97  479 AT&T          41.75     37.25   -10.78%


    Rec'd   #  Security     In At     Value    Change
   1/2/97  120 3M          9960.00  12255.00  $2295.00
   1/2/97  153 Chevron     9945.00  11398.50  $1453.50
   1/2/97  179 Gen. Motor  9979.25   9956.88   -$22.38
   1/2/97  479 AT&T       19998.25  17842.75 -$2155.50


                             CASH    $609.53
                            TOTAL  $52062.66