News of Iraqi Oil Deal Sends Dow Back Into Record Books

The Dow Jones industrials jumped to a record high Monday for the first time since early April, propelled by sharp gains in major energy stocks after Iraq struck a deal to begin selling oil again.

The Dow leaped 61.32 points, or 1.1%, to 5,748.82, the first close above 5,700 and the first record for the blue-chip index since it finished at 5,689.74 on April 3.

The broad market also closed at record levels, although its gains were less impressive than the Dow’s rise.

For the Dow, which has lagged most other stock indexes in recent months--especially small-stock indexes--Monday’s new high was achieved in somewhat perverse fashion: Crude oil prices rebounded on news of Iraq’s deal with the United Nations, and that drove big energy stocks up.

Analysts said crude prices, and oil stocks, had already assumed a deal with Iraq was near, so rather than decline on expectations of additional oil supplies the price of crude surged Monday.

“All the bad news has been factored into the market, and now that the deal looks done, there’s nothing left to drive prices down,” said John Saucer, an analyst at Smith Barney in Houston.

June oil futures on the New York Mercantile Exchange jumped $1.84 to $22.48 a barrel. Longer-term oil futures also rose sharply, after slumping in recent days.

Within the Dow, Exxon leaped 2 1/2 to 87 1/4, Chevron gained 2 1/2 to 62 and Texaco surged 3 1/8 to 86 7/8. Those three stocks accounted for about half the Dow’s rise.

In the broad market, stocks posted more modest gains. Still, most major indexes hit new highs. The Standard & Poor’s 500 index added 4.24 points to 673.15; the Nasdaq composite rose 6.23 points to 1,248.11.

Winners topped losers by 13 to 10 on the Big Board and by 21 to 17 on Nasdaq, in moderate trading.

“There’s a lot of money out there, and [managers] don’t want to be sitting on 30% cash [in their mutual funds] when the Dow hits 6,000,” said Anthony Conroy, director of equity trading at BT Global Asset Management.

The Dow, already up 12.3% this year, needs to rise only 4.4% from its current level to top 6,000.

A continuing rally in the bond market could help stocks. On Monday long-term yields were mostly unchanged after sliding last week, as worries eased about the economy’s strength and about inflation. The 30-year Treasury bond yield held at 6.83% Monday.

The Federal Reserve Board meets today, amid widespread expectations that the central bank will leave short-term interest rates at current levels.

Among Monday’s highlights:

* Energy-related stocks leading the market higher included Atlantic Richfield, up 3 1/8 to 121 1/2; Halliburton, up 4 1/8 to 56 1/4; Western Atlas, up 2 5/8 to 63 1/4; and Sonat, up 7/8 to 43 7/8.

* Some red-hot technology shares got even hotter. Xylan rocketed 6 9/16 to 74 5/16, Iomega soared 13 3/8 to 82 5/8, Westell jumped 5 7/8 to 83 5/8 and Dell Computer gained 2 5/8 to 50 3/4.

* GE leaped 3 1/8 to 84. Its GE Capital Services unit agreed to acquire AmeriData Technologies. AmeriData rose 3/8 to 15 3/4.

* Chiron soared 5 1/4 to 102 after the biotech company declared a 4-for-1 stock split.

* On the downside, beleaguered ValuJet slumped 1 7/8 to 11 1/4. The airline said late Friday that it had decided to cut the number of its daily flights in half so it could inspect its entire fleet, after the recent fatal Florida crash.

* Falling prices for copper, gold, platinum and other key metals drove mining stocks lower. Alcoa slumped 1 7/8 to 63 1/2, Alumax lost 1 3/8 to 33, Phelps Dodge sank 1 3/8 to 70 1/2 and Newmont Gold dropped 1 7/8 to 58 1/4.

In foreign trading, Mexico’s Bolsa index followed the Dow to a record high, gaining 1.7% to 3,316.21. In Brazil the Bovespa index shot up 1.7% to 56,557.

But in India the Bombay 30-share index tumbled 2.7% on concerns about the new government’s ability to remain in power.