Things aren't good because they are too good. On March 31, the end of the Town Crier Stock Index first quarter, Wall Street traders pushed down the Dow by 157.11 points. The cause of gloom is economic expansion, and a Federal Reserve interest rate hike to prevent expansion set the previous week.
By the end of first quarter 1997, of the 41 stocks on the Town Crier Stock Index, 21 are lower than their Jan. 1 stock price.
At the end of the first quarter, Micro Linear, Spectrain, Tencor Instruments and Gasonics International were the largest percentage gainers since the first of the year. 3 Com Corporation, 3 Do Company, Legato Systems and Rational Software were the largest percentage losers.
On Jan. 1, an investment of $112,051 was used to purchase 100 shares of each of the 41 stocks that have top executives living in Los Altos or Los Altos Hills. That investment lost $7,404 or 7 percent of the portfolio..
Stock market prices are based on the assumption of juicy earnings growth for several years into the future. Rising interest rates could have a big affect on earnings.