ROANOKE TIMES
Copyright (c) 1996, Roanoke Times
DATE: Thursday, July 4, 1996 TAG: 9607050050
SECTION: BUSINESS PAGE: B-8 EDITION: HOLIDAY
PLAQUEMINE, La. - A Louisiana judge gave preliminary approval Wednesday to a potential $5 billion settlement of lawsuits alleging defective ``side-saddle'' gas tanks in 1973-78 General Motors pickup trucks.
State District Judge Jack T. Marionneaux scheduled a hearing Nov. 6 to grant final approval of the settlement, which could give 5 million truck owners $1,000 each toward the purchase of another GM vehicle.
The settlement covers C or K series trucks equipped with so-called ``side-saddle'' gas tanks. Critics said the trucks posed a fire hazard in side-impact crashes because their fuel tanks were mounted outside the protection of the frame.
``The next thing is to send a notice to all of the truck owners, notifying them of the preliminary approval and providing them with a snapshot of the settlement and instructions on where to write and get more details,'' plaintiffs' attorney said.
Owners should receive notice by August and, if no one objects at the Nov. 6 hearing, a final settlement could be reached by January, said Pat Pendley, an attorney for the plaintiffs.
He estimated the settlement would cost GM in excess of $5 billion.
Sheila Main, GM's spokeswoman for legal issues and product recalls, could not be reached for comment. But Pendley said the automaker's lawyers agreed to the settlement. |- Associated Press , But Tech Jitters Continue|
Fed brings
sigh of relief
NEW YORK - The Federal Reserve gave investors what they were hoping for, leaving interest rates unchanged, but stocks ended mostly lower Wednesday as worries about computer-industry profits worsened.
The Dow Jones industrial average fell 17.36 to 5,703.02, more than halving an afternoon deficit of almost 38 points.
Broader indicators also improved after the Fed announced its decision not to slow the economy with a rate hike, but still ended mostly lower.
``It shouldn't be surprising that there was not that big a rally,'' said William Dodge, portfolio manager at Marvin & Palmer Associates of Wilmington, Del. ``The market's early weakness shouldn't have been attributed to the Fed. The preponderance of the negative news is coming from technology.''
Declining issues outnumbered advancers by a 10-to-9 margin on the New York Stock Exchange, where volume slowed considerably going into the July 4 holiday, totaling 334.57 million shares as of 4 p.m.
The NYSE's composite index fell 0.64 to 360.37, the Standard & Poor's 500-stock index fell 1.21 to 672.40, but the American Stock Exchange's market value index rose 0.09 to 579.65.
The technology-heavy Nasdaq composite index fell 9.55 to 1181.60 after another stream of negative earnings projections concerning computer-related businesses.
Trading had continued at Tuesday's cautious pace until late in the session, when the Federal Reserve concluded a two-day meeting with word that the central bank's lending rates had been left unchanged.
The decision had been expected by many economists, who argued that Fed officials want to see more information on the pace of inflation before taking action. Higher rates slow borrowing and spending, offsetting inflationary pressures in a strong economy, but hurting corporate profits through higher operating costs and slower revenue growth.
Bonds had slipped early in the session after the Commerce Department reported that orders to U.S. factories jumped 1.9 percent in May, the third straight advance and the biggest in nine months. But the increase was in line with expectations and likely had little impact on the Fed's deliberations.
``The Fed is proceeding cautiously right now. If this were not an election year, the Fed would have had enough ammunition to raise rates,'' said Russ Labrasca, senior vice president at Principal Financial Securities of Dallas. ``Traders can start the Fourth of July with the peace of mind that they won't have anything to worry about - at least until next week.''
Although the Fed's inaction put some minds to rest, investors were forced to contend more bad news in technology.
``It's going to be at least a few weeks before we settle concerns about earnings in key areas such as technology,'' Palmer said.
Computer maker Digital Equipment, down 11/2 to 381/4 on the NYSE, added to the 5-point plunge Tuesday that followed its announcement that earnings from the second quarter will fall shy of expectations. Hewlett Packard, meanwhile, fell 33/8 to 941/8 after an analyst reportedly downgraded the stock.
The same fate befell Sun Microsystems, down 17/8 at 57 on the Nasdaq market, which also saw several smaller technology concerns plunge on negative earnings outlooks. Modem and modem-software companies fell sharply after Zoom Telephonics, down 41/2 at 111/2, issued a discouraging second-quarter estimate.
Auto stocks slid in the aftermath of this week's flat sales reports by the Big Three automakers. Combined, Ford, General Motors and Chrysler saw their sales fall 1 percent in June.
In active NYSE trading, Chrysler fell 35/8 to 597/8, Ford fell 15/8 to 317/8, and General Motors fell 15/8 to 521/8 as the Dow's biggest decliner.
Overseas, Tokyo's Nikkei stock average rose 0.1 percent, Frankfurt's DAX index fell 0.1 percent, and London's FT-SE 100 fell 0.3 percent. |- Associated Press U.S. announces
shave-gel recall
WASHINGTON - The government has announced a voluntary recall of more than 500,000 cans of Pfizer's PureSilk Shave Gel for women because the can's interior liner may corrode and rupture.
The Consumer Product Safety Commission said consumers could be injured by a plastic component that may be sent flying from the can, or by the sharp edges of the ruptured canister itself.
Pfizer said it knows of 10 incidents of ruptured cans. None involved injuries.
Drug, grocery and cosmetic stores sold the 7-ounce cans of shaving gel between October 1995 and June 1996 for between $2 and $2.50.
The recall does not affect Pfizer's PureSilk Shave Cream.
The commission said consumers should discharge the gel to reduce pressure inside the can and contact Pfizer at (800) 723-7529 for information on obtaining refunds or replacements. |- Associated Press
30-year
mortgages dip
WASHINGTON - Thirty-year, fixed-rate mortgages averaged 8.14 percent this week, down from 8.29 percent last week, according to a national survey released Wednesday by the Federal Home Loan Mortgage Corp.
It was the lowest since May 30, when rates averaged 8.03 percent. Rates had averaged 8.39 percent June 13, highest since 8.41 during the week ended April 6, 1995.
On one-year adjustable-rate mortgages, lenders were asking an average initial rate of 5.94 percent, down from 5.98 percent last week.
Fifteen-year mortgages, a popular option for those refinancing mortgages, averaged 7.67 percent this week, down from 7.82 percent a week earlier.
The rates do not include add-on fees known as points. |- Associated Press
Downtown Roanoke
wants input
Downtown Roanoke Inc. will hold two public sessions on July 17 to gather resident input for Outlook, its study of downtown planning.
An outdoor session will be held adjacent to the Friendship Fountain at the Roanoke City Market from 11:30 a.m. to 1:30 p.m. A public meeting will be at 7 p.m. in the Market Building.
Sketches presenting the areas under study will be on display in the windows of the former Heironimus Building beginning July 9. |- Staff report
Shaw acquires
Mich. retailer
Shaw Industries Inc., a Dalton, Ga., carpet manufacturer, said Wednesday it has completed acquisition of New York Carpet World Inc., a Southfield, Mich., retailer with 200 stores in 15 states, including Western Virginia. Terms of the transaction were not disclosed.
New York Carpet World is the largest retailer of carpet products in the country.
Shaw Industries manufactures and sells carpeting, rugs and other flooring products throughout the North America, the United Kingdom and Australia. |- Associated Press
LENGTH: Long : 154 linesby CNB