Stocks End Session With Gains

Blue-chip stocks ended a volatile session with modest gains Friday as the so-called triple-witching options and futures expirations produced the third biggest trading volume ever on the New York Stock Exchange. The Dow Jones industrial average rose 10.76 points to 6,484.40. For the week, the Dow was up 179.53, its strongest week since the first full week of November, when blue chips began a scorching month-long rally of more than 500 points. The Nasdaq Composite index closed 7.30 points lower at 1,288.56.

Economy Slowed in 3rd Quarter

The Commerce Department says the U.S. economic slowdown in the third quarter was not as abrupt as previously reported. The department says the the nation's gross domestic product expanded at a 2.1 percent annual rate in the three months from July through September. That's fractionally higher than the 2 percent rate estimated a month ago, but still less than half the 4.7 percent pace posted during the second quarter. GDP measures the value of all goods and services produced by workers and capital within U.S. borders. Early indications are that the fourth quarter will see continued moderate growth around a so-called "trend rate" of 2.25 percent a year.

Conrail Spurns Norfolk Southern

Conrail on Friday spurned a sweetened $10.5 billion takeover offer from hostile suitor Norfolk Southern Corp. amid speculation that a 2-month-old bidding war for the railroad was drawing to a close. As expected, Conrail rejected the offer and contended that its proposed friendly $9.3 billion merger with CSX would be a better corporate combination. The rejection came just one day after both CSX and Norfolk Southern raised their bids for Conrail. Industry analysts said both sides will pursue the fight in court, before regulators and in the marketplace.

Fed Ups Underwriting Percentage

The Federal Reserve took another step Friday toward eliminating the barriers between banking and other financial service industries, voting to allow banks to further invade the turf of Wall Street securities firms. The Fed Board of Governors voted unanimously to increase the percentage of revenue bank subsidiaries may earn from underwriting and dealing in securities to 25 percent from 10 percent. Banks were elated by the new rule, but securities firms were not. "It's as if Santa Clause delivered all the gifts to only one house in the neighborhood," said one official with the Securities Industry Association.

Fed Rebuffs Justice Request

The Federal Reserve Friday rebuffed a request by the Justice Department to allow U.S. banks to collect data about borrowers as part of an effort to discourage racial discrimination in lending. The unanimous decision put the central bank's board in the unusual position of being at the center of a national debate about how best to discourage discrimination. The regulation, which was established in 1977, was designed to discourage discrimination by race, gender and age by prohibiting banks from collecting such data from borrowers.

Rock-Tenn to Buy Waldorf

Rock-Tenn Co. says it has agreed to buy Waldorf Corp. for about $410 million including assumption of debt. The deal is the largest step so far in Rock-Tenn's plan to grow through strategic acquisitions in the consolidating packaging and paperboard industry. The deal would create the second-largest producer of folding cartons in North America. Rock-Tenn said it would also most likely be the biggest producer of 100 percent recycled paperboard, excluding containerboard and gypsum board, with capacity to produce almost 1 million tons a year.

Financial Trust to be Acquired

Keystone Financial says it has agreed to acquire fellow Pennsylvania banking company Financial Trust Corp. for about $371 million. Financial Trust, a bank holding company with four member banks and about $1.2 billion in assets, operates 48 community offices in seven counties in Pennsylvania and Maryland. Keystone, the fifth-largest banking company in Pennsylvania, has five member banks which operate 147 offices in Pennsylvania, Maryland and West Virginia.

Chairman: Heinz to Slim Down

Tony O'Reilly, chairman of H.J. Heinz, says the company's U.S. food group will be slimming down. O'Reilly, in the telephone interview from Dublin, said the food company he has run since 1979 was in talks with prospective buyers and would sell substantial businesses by April 30. O'Reilly declined to identify the businesses on the auction block or estimate how much cash the properties would bring Heinz, which dominates in canned tuna, ketchup and other segments. O'Reilly said Heinz will trim down to six business clusters: food-service products, pet food, infant formula outside the United States, condiments, ketchup, and weight-loss services and products.

Dollar Drifts Higher Against Yen

The dollar drifted higher against the Japanese yen but fell against the German mark in quiet trading Friday as traders looked to lock in profits before the upcoming Christmas and New Year's holidays. In very light trading, the dollar fell to 1.5515 marks from 1.5575 late on Thursday. Meanwhile, a weak Japanese economy and sputtering stock market weighed on the yen, helping the dollar edge up to 114.27 yen late Friday from 114.03 yen late Thursday.

Oil, Grain Prices Fall

Oil and grain prices fell on Friday as traders took profits on this week's gains as sentiment improved about the availability of supplies. At the New York Mercantile Exchange oil prices were led lower by heating oil despite colder weather in the Northeast, which would increase demand in the world's largest market. Countering that was news that Colonial Pipeline Co., which operates a primary Houston-to-New York conduit for fuels, said it extended space allocations through January due to heavy competition to ship heating oils northward. Heating oil for January delivery lost 0.81 cent to settle at 72.97 cents a gallon.

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