Tallahassee Democrat from Tallahassee, Florida • Page 6

riday, February 25, 1994 Tallahassee Democrat PURSOXU, nACE: 9A M. RKET REPORT: 9A MSK: 10A AMEX, IXASDiQ: 11A MOMIXY: Weekly Treasury bill auction held. TULRSDXY: Labor Department issues weekly jobless-claims report. WALL STREET BRIEFS Stock marM urn ACTIVE ISSUES General Instrument, down 6 to 44Vi: The stock's Investment rating was downgraded to "hold" from "strong buy" by Cowen Co. Compaq, up 3 to 100: Investors reacted positive to news that the company reportedly plans to expand operations and resume domestic production of portable computers.

Southwestern Bell, 114 to 38: Southwestern Bell will expand its cellular-telephone business by acquiring the domestic interests of Associated Communications Corp. in a stock swap worth $680 million. Profits for all of 1993 were at a record high $492 million, 36 percent higher than the previous record of $360.8 million reported in 1992. Earnings in 1992 were brought down by a $158-million pre-tax stock-option charge, the company said. Sales for 1993 were $5.89 billion, up 6 percent from $5.57 billion in 1992.

Catalog sales boost J.C. Penney earnings Fourth-quarter profits for J.C. Penney Co. Inc. rose nearly 17 percent on strong catalog sales, the company said Thursday.

For the quarter ended Jan. 29, Penney earned $437 million, or $1.64 per share, on sales of $6.3 billion. The retailer had profits of $375 million, or $1.42 per share, on sales of $6.1 billion during the fourth quarter of fiscal 1992. For all of 1993, Penney reported its highest-ever profits $940 million, or $3.53 per share, on sales of nearly $19 billion. The company earned $777 million, or $2.95 per share, on sales of $18 billion in 1992.

VIDEO STORE activity. Evidence of economic vigor typically upsets the bond market because it is associated with inflation, the archenemy of fixed-interest investments. Bearish sentiment rampant in the bond market overshadowed a decent showing at the Treasury's five-year note auction and the closely watched 30-year Treasury bond ended the day down more than a full point driving up its yield to 6.73 percent from 6.65 percent late Wednesday. Market veterans, who blamed the stock market's slide mainly on the bond market's performance, noted that attitudes have turned against stocks. "There's real concern here about the rise in interest rates.

The fear now is that this rise in interest rates will reduce the flow of money into mutual funds. If it does, then the market has real problems," said Michael Metz, a vice president at Oppenheimer Co. Exchange "circuit breaker" aimed at coping with extreme conditions and preserving investor confidence. The popular blue-chip indicator lost 51.78, closing at 3,839.90. Broader market measures also posted steep declines.

The NYSE composite index fell 3.38 to 257.75 and the Standard Poor's 500 index dropped 6.43 to 464.26. Selling waves washed over smaller stocks as well. The Nasdaq Stock Market composite fell 9.67 to 779.44. At the American Stock Exchange, the market value index PEPSI-COLA mji mi mji i irnumu niijii -S. 0 The Dow falls 51 points amid fears of rising interest rates and disappointment over a failed multibillion-dollar merger.

By Marybeth Nibley THE ASSOCIATED PRESS NEW YORK The collapse of a multibillion-dollar corporate merger against a background of rising interest rates caused a setback for the stock market Thursday. Weakness in stocks abroad added to the gloom on Wall Street where the Dow Jones industrial average dropped enough in the final half hour of trading to trip a New York Stock V. Jowell Roque holds several Pepsi 3J 44 -4 ECONOMY Durable-goods orders, jobless claims rise Factory orders for large long-lasting goods surged in Jan-" uary, fueled by a jump in the volatile aircraft and defense sec--tors, the government said Thursday. Orders to U.S. factories for durable goods jumped 3.7 percent last month, the Commerce Department said, marking the first time in 62 years the indica- tor has climbed for six straight months.

Meanwhile, the Labor De-! partment reported that the number of Americans 'filing first-time claims for jobless benefits shot up by 25,000 last week, to 385,000, up from a re-. vised 360,000 during the week that ended Feb. 12. Analysts attributed some of the increase to winter weather and the Califor-. nia earthquake.

MORTGAGE RATES 30-year mortgages rise to 7.32 percent Thirty-year, fixed-rate mort-. gages averaged 7.32 percent this week, up from 7.11 percent last week, according to a national survey released Thursday by the -Federal Home Loan Mortgage Corp. It was the highest since June 24 when they averaged 7.34 percent. On one-year adjustable-rate mortgages, lenders were asking an average initial rate of 4.25 percent, up from 4.18 percent last week. Fifteen-year mortgages 6.80 percent this week, up from 6.64 percent a week 1 earlier.

The rates do not include add-' on fees known as points. INTERNATIONAL German metalworkers stage warning strikes About 360,000 metalworkers i staged warning strikes Thursday in cities throughout Germany to pressure employers for new contracts, union officials said. Workers in the country's vital auto sector and related industries were among those tak-s ing part in the walkouts, which lasted for several hours and were the most widespread in a month of strikes. The powerful IG Metall union, which represents 3.2 million of western Germany's 3.6 million metalworkers, said in the North-Rhine Westphalia state alone some 168,000 em-' ployees walked off job at 970 firms. Another 90,000 workers Joined strikes in the southern state of Baden-Wuerttemberg.

The union is seeking to boost wages and maintain generous benefits. STOCK RJR Nabisco plans preferred-stock issue RJR Nabisco Holdings the food and tobacco conglomerate, said Thursday it plans to raise about $2 billion through an issue of preferred stock that will be converted into common stock in three years. The company said it planned to use the proceeds for general corporate purposes such as refinancing debt but added it may use some money for "one or significant corporate transactions" that could include a spinoff, merger, joint venture or acquisition. The sale is expected to be cleared and occur within two to six weeks. i EARNINGS Levi Strauss reports record profits for 1993 Levi Strauss said Thursday its profits increased by 5 percent in the fourth quarter of 1993, fueled in part by rising sales, low- interest expenses and a lower tax rate.

The company earned $141 in the fourth quarter, compared with $134 million in the fourth quarter of 1992. Sales were up 2 percent from the same quarter in 1992, to $1.59 million, from $1.56 billion. tumbled 6.16 to 465.58. Losers swamped gainers on the NYSE by about 4 to 1. Trading was active and 341.62 million shares changed hands on the Big Board as of 4 p.m.

EST, up from 309.90 million on Wednesday. Heavy selling in a broad range of stocks coincided with another weak day for the bond market, which sent interest rates roaring higher. Traders began bailing out of bonds right from the opening in response to a government report of unexpectedly robust economic The Associated Press Roque said he had planned to use part of his winnings to pay for his school tuition and part to buy a rice farm for his father, a hog raiser, and his mother, a public school teacher in Pandi. His family has spent $1,785 on the lawsuit, a large amount for ordinary people in this poor country, and he expects to spend more if Pepsi appeals. But he is undeterred.

"We can say now that we have won once and we will pursue this. There is no backing out," he said. Pepsi already has paid. It doled out $18 each to about 500,000 people who held "349" caps in an attempt to calm public protests. The $10 million it spent on the "goodwill gesture" was five times what it budgeted for the entire promotion.

Two weeks ago, local Pepsi executives officials lost an appeal to annul an arrest order issued by a suburban Manila court where more than 17,000 winning cap-holders filed criminal complaints. They will appeal to the Supreme Court a MERGER MARKET REACTION Bell Atlantic, up 1 to 54'. Nasdaq-listed Tele-Communications class A shares lost 154 to 22 and topped the Nasdaq's actives list in heavy volume of more than 24 million shares. Two different visions killed mega-merger Officials at Bell Atlantic and Tele-Communications Inc. had fundamentally different views of the marketplace.

By Evan Ramstad THE ASSOCIATED PRESS NEW YORK The mega-merger of Bell Atlantic and Tele-Communications stitched together at the height of a hypnotic frenzy about the future of communications, unraveled when the companies awoke with different visions. In the aftermath Thursday, executives from both companies blamed outside forces, including Wall Street and Washington. But their statements also revealed fundamentally "divergent views of the marketplace. Bell Atlantic was most anxious to start providing communication services outside its six-state East Coast region. TCI wanted to blaze a two-way path to every home for loads of TV shows, movies and games.

The deal's collapse presents a lesson in the trouble of placing a value on products or assets today when their future importance is hard to know. It also shows the difficulty of balancing the utility-like regulation of communication companies with a desire for advanced services and technology requiring enormous amounts of money and entrepreneurs willing to take risks. These troubles likely will be encountered repeatedly as companies try to develop advanced communications services, the so-called "information superhighway." TCI and Bell Atlantic complained that a cut in cable rates ordered by the Federal Communications Commission earlier this week sabotaged their deal, which had been valued in a range from $12 billion to $30 billion. They also blamed a drop in the price of Bell Atlantic's stock, which was driven down by higher interest rates and a migration of big investors to stocks of other companies prospering in the strengthening economy. FCC commissioners and members of Congress said the companies overreacted if they ended their merger based on the agency's action.

"These two giant monopolies want to blame someone else for their Droblpm and the obvious culprit is the government," said Sen. Howard Metz-enbaum. rwihin r-hn; to viiau man ui i.iv Senate Judiciary Committee. Video-store owner wants overdue fees from police A video-store owner who was cleared of obscenity charges wants police to return the two X-rated videotapes they used as evidence against him and to pay nearly $8,000 in overdue rental fees. David Wingate who owns Video-Rama in Grand Haven.

was acquitted last month of two second-degree counts of disseminating obscenity. The evidence against him included two X-rated tapes rented in 1991 by an undercover police officer. Wingate is billing police his customary $2-per-day per-tape late charge for the two tapes and for six other X-rated videos that were rented but not used as evidence. Those six tapes were later returned. Public Safety Director Bob Huff said he will forward the bill to prosecutor Ron Frantz because officers were acting on the prosecutor's behalf when they rented the tapes.

Frantz called the bill "totally ridiculous." He said he will not pay, but will return the tapes to Wingate by next week. TECHNOLOGY Exercise and have fun with 'Exertainment' You need to exercise. You'd rather play video games. Do both, says Life Fitness the maker of Lifecycle exercise bikes. This summer, the company, based in suburban Franklin Park, will unveil a version of the Lifecycle called "Exertainment" that was developed with game-maker Nintendo.

The bike, which will retail for about $1,000, is meant to divert you from the boredom many people experience during exercise, Life Fitness said. The rider must supply a Nintendo game machine. The rider punches in personalized information, then starts pedaling. Success at the games that follow depends on how consistently the rider is able to stay within a target heart rate. CREDIT CARDS CompuServe introduces Visa credit card CompuServe Inc.

on Thursday introduced its own Visa credit card for subscribers to the online computer network. The cards, issued by CompuServe parent Block Inc. and Columbus Bank Trust of Columbus, Ga, carry a $27.50 credit toward hourly CompuServe usage charges. On-line shoppers who use the card to make purchases from CompuServe's Electronic Mall will be offered discounts by various merchants. Customers who use the CompuServe Visa at least six times each year will pay no annual fee.

The Visa Gold version of the card will have an annual interest rate of 12.9 percent The Visa -Classic interest rate will be 14.9 percent Democrat news services bottle caps. Roque won a lawsuit against Pepsi- Cola as a result of a sweetstakes snafu in 1992 that caused thousands to come up with winning numbers in a Pepsi promotion. Pepsi says a computer mistake caused the fiasco, which resulted in 600,000 bottle caps being printed with the winning number. The first of 600,000 big winners? Jowell Roque is the first Filipino to win a lawsuit against Pepsi-Cola as a result of a sweepstakes fiasco that saw thousands come up with the winning numbers. By Oliver Teves THE ASSOCIATED PRESS PAN Dl, Philippines Jowell Roque is getting kidded these days by neighbors who'd like him to promise a "balato" a Filipino word for a share in a prize.

Roque, a 21-year-old nursing student, is the first Filipino to win a lawsuit against Pepsi-Cola as a result of a sweepstakes fiasco in 1992 that saw thousands of people come up with winning numbers in a Pepsi sales promotion. A court in Malolos, capital of Bulacan province north of Manila, ruled Feb. 4 that the U.S. soft-drink company should pay Roque 1.1 mil lion pesos, about $39,285. It also awarded $2,392 in damages, legal fees and court expenses, but Pepsi is expected to fight the case all the way to the Supreme Court.

"It's not over yet," Roque said Wednesday, shaking his head. The fight over the "Number Fever" promotion is a high-stakes battle for Pepsi, because tens of thousands of people claimed the top prize of 1 million pesos after the contest's winning number of "349" was announced May 25, 1992. Pepsi refused to pay, saying a computer mistake resulted in 600,000 bottle caps being wrongly printed with the winning number. The company argued it didn't have to pay because the computer glitch also did not print the caps with "winning" security codes as well. But the court ruled the codes were intended only to determine authenticity of winning caps and were not a requirement for winning.

Pepsi spokesmen have declined to comment on the ruling..