WALL STREET SURVIVES TRIPLE EXPIRATIONS
The four-times-a-year "triple
witching hour" did not jolt Wall Street as much as it has in
the past.
    Market averages finished sharply higher as stock index
futures, index options and options on individual stocks expired
simultaenously. Some analysts warned part of the gain may be
retraced next week. But there were signs Wall Street is getting
used to the phenomeon which causes a huge burst of activity in
the final minutes. Officials of the New York Stock Exchange
said the day went smoothly and efficiently.
    "This has been one of the few times that the consensus has
been right," said Jim Creber, trader at Miller, Tabak, Hirsch
and Co.
    He expects a "follow-through" Monday and Tuesday to the
advance which lifted the Dow Jones Industrial Average 34 points
for the day and 75 points for the entire week.
    Creber, whose firm was one of the first to get involved in
arbitrage activity involving index futures and options, said
the general trend of the market has been upward for months.
"Every time the market comes in, somebody comes along with more
money," he said.
    He said investors adding to Individual Retirement Accounts
prior to a mid-April tax deadline and buying from Japanese
investors are apparently helping push stocks higher.
    Ron Feinstein, an analyst with Dean Witter Reynolds Inc,
said reports of heavy Japanese buying, just prior to the end of
the fiscal year in Japan, fueled bullish sentiment.
    He said investors who had long positions in stocks hedged
with short positions in index futures rolled the expiring March
futures over into June contracts. But he added different
players with other goals also were active and there was no
simple explanation of the market's gyrations.
    For example, Feinstein noted the June contract for the June
Standard and Poor's 500 stock index future hit 300 about 15
minutes prior to the close of NYSE trading. In 12 minutes, the
contracted dipped to 297.50. "That could have been a wave of
selling from institutional people making a roll," he said.
    It was the first time a nearby contract of the S and P 500
hit 300. The cash index closed at a record 298.17. "It looks
like the market is going to continue to go higher," he said.
    "Triple expirations didn't really mean that much, it was a
strong day for stocks," said Steve Chronowitz of Smith Barney,
Harris Upham and Co.
    Chronowitz said the stock market has been underpinned by
"good solid buying interest" which will cushion any pullback.
    Other investors who were long futures and short stocks
bought stocks on the close today instead of rolling over, said
Mark Zurack of Goldman, Sachs and Co. He cautioned against
"over-dramatizing" the day's activity, which said was more a
reflection of fundamental strength in the markets.
    Leigh Stevens of PaineWebber Group Inc said what he saw was
mostly covering of short positions in stocks as index options
and individual options expired. He said there could be a
decline early next week in the stock market.
    "It looked like it worked well today," said Howard Kramer,
asssistant director of market regulation for the Securities and
Exchange Commission. But he said all of the data will have to
be analyzed next week.
    He said there was relatively little commotion at the close,
with about 50 mln shares changing hands in the final minute
compared to 85 mln in the triple expirations three months
earlier. He noted the Dow industrials jumped about 12 points in
the closing minutes, a modest move for a 2333-point index.
    Kramer pointed out an SEC-NYSE measure to curb volatility,
disclosure of "market-on-close" orders in 50 major stocks 30
minutes prior to the end of trading, showed imbalances of
modest proportions. The disclosures are aimed at evening out
volatility by attracting orders on the opposite side of the
imbalance.
    The data showed more buy orders than sell orders for 47
stocks, a preponderance of sell orders for only one stock, and
no significant imbalance for two stocks. The NYSE had tightened
a rule governing what type of market on close orders can be
accepted in the final half hour.
 Reuter
