Dow soars
135.65 to record

NEW YORK -- Stocks rocked to record highs for the fifth consecutive session today, as a weak May retail sales report erased lingering fears that the Federal Reserve would soon raise interest rates.

The stock market also benefited from a report that net cash flows into equity funds rose 18 percent in May.

The Dow Jones industrial average rose 135.64 to close at 7,711.47, punching through 7,600 without breaking a sweat and then sailing past 7,700. The blue-chip index is up nearly 20 percent for 1997.

Advancers led decliners by a 5-to-2 margin on the New York Stock Exchange, with 1,919 up, 745 down and 739 unchanged. NYSE volume was 592.73 million shares vs. 513.74 million yesterday.

The Standard & Poor's 500-stock list rose 13.19 to 882.76, and the NYSE's index rose 7.14 to 460.64, records for the fifth straight session for both indexes. The Nasdaq composite index gained 3.48 to 1,411.33. And the American Stock Exchange composite rose 3.45 to 626.12, its fourth straight record.

Market participants were effusive in their praise of the market's performance. Some were merely amazed. "I'm dumbfounded," said Hugh Johnson, market strategist at First Albany Corp.

One cause for celebration on Wall Street was that despite some continued stickiness in computer-related stocks, secondary stocks in general have caught fire along with the blue chips, said Bill Mahan, an analyst at Prudential Securities.

Even highly cyclical stocks have kept pace, Mahan said. "It's not just a small number of companies that are driving this market. We just keep marching along."

Stocks opened higher along with bond prices, after the Commerce Department said retail sales fell for a third straight month in May, slipping another 0.1 percent, following declines of 0.9 percent in April and 0.3 percent in March. Economists expected a gain of 0.3 percent in May.

The 30-year Treasury bond was up 1 point, pushing its yield, which moves opposite the price, down to 6.76 percent from 6.84 late yesterday.