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Stocks Higher; Dow Up 42.22

December 22, 1998

NEW YORK (AP) _ Blue-chip stocks turned higher this afternoon, but many big technology names fell today amid some profit-taking from a record-setting rally.

At 2 p.m. on Wall Street, the Dow Jones industrial average was up 42.22 at 9,031.07 after recovering from a 40-point drop.

The blue-chip recovery lifted the Standard & Poor’s 500 index 2.33 to 1,205.17, padding Monday’s record high. The technology-heavy Nasdaq composite index was down 9.17 at 2,128.86 after setting new highs on Friday and Monday.

Once again, however, smaller companies were being shunned, with declining issues outnumbering advancers by a 3-to-2 margin on the New York Stock Exchange and the Nasdaq Stock Market.

There was barely any reaction this afternoon when Federal Reserve officials, as expected, concluded one of their periodic meetings without another cut in lending rates.

The central bank has already helped stabilize world financial markets with three rate cuts this fall. But while the global backdrop remains shaky, Fed officials are also worried about inflationary pressures in the domestic economy, which has been surprisingly resilient.

Blue-chip stocks have risen in recent sessions despite a spate of profit warnings by leading companies, not to mention Saturday’s impeachment of President Clinton and the U.S.-led bombing of Iraq.

NYSE volume came to 451.81 million shares this afternoon, down from 487.51 million at the same time on Monday.

The NYSE composite index was up 1.38 at 579.08, and the American Stock Exchange composite index was up 3.05 at 657.17.

Overseas, Japan’s Nikkei stock average fell 2.6 percent. Germany’s DAX index rose 0.9 percent, Britain’s FT-SE 100 fell 0.6 percent, and France’s CAC-40 rose 0.5 percent.

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