News stories from Wednesday January 2, 1974

Summaries of the stories the major media outlets considered to be of particular importance on this date:

The Internal Revenue Service announced that it was re-examining President Nixon's income tax returns but did not say which years were being covered by the audit. The disclosure, authorized by the President, left unclear whether the I.R.S. would examine the return for 1969. That was the year that the President claimed that he made a gift to the nation of his Vice-Presidential papers valued at $576,000. [New York Times] President Nixon signed a bill that would withhold federal highway funds from states that do not reduce speed limits to 55 miles an hour and added his signature to the Regional Rail Reorganization Act, which provides federal financing to consolidate seven major bankrupt railroads in the Northeast and Middle West. In signing the speed limit bill, Mr. Nixon estimated that a 55-mile-an-hour speed limit on the nation's highways would save "nearly 200,000 barrels" of fuel a day. [New York Times] Watergate conspirator E. Howard Hunt has been released from prison pending the outcome of his appeal. Hunt thanked the courts, his lawyers and the general public for their support. Watergate burglar Bernard Barker will be released soon on the same basis. [CBS] In its first survey of the effects of the fuel shortage on its nationwide rail system, Amtrak reported a sharp increase in patronage in the last weeks of 1973, with the gains on many routes growing week by week. Compared to a similar five-week period in 1972, Amtrak said, Metroliner passengers increased 30 percent, the New York-Boston run 37 percent and the New York-Florida run 26 percent. [New York Times] American Airlines said it would ground ten of its 16 Boeing 747 jumbo jets beginning Monday because of the fuel shortage, and Trans World Airlines said it would take two of its 19 747's out of service the same day. The groundings will make a total of 16 747's that have been withdrawn from service along with dozens of smaller planes since the emergence of the fuel crisis. [New York Times] President Nixon signed bill a consolidating seven bankrupt railroads, with government money backing the plan. Transportation Secretary Claude Brinegar stated that rail service will be improved greatly as a result. However, labor problems may remain. [CBS] The Federal Reserve Board reduced the margin requirement for stock purchases from 65 to 50 percent, thus allowing investors to borrow as much as half the cost of buying securities. In announcing the action, the board cited the "sharp reduction" in stock market borrowing, which declined to $5.5 billion as of Nov. 30 from a peak of $7.9 billion in December, 1972. Margin requirements were raised from 55 to 65 percent in November, 1972. [New York Times] Amoco raised its gasoline prices today, as did Sunoco. Home heating oil and diesel fuel will soon see price hikes also. [CBS] The Food and Drug Administration is planning to require certification of each batch of an important heart drug because some samples have not met acceptable standards in the rate at which the drug dissolves. The drug, digoxin, is used by an estimated 3.5 million Americans a year to produce a stronger heartbeat, but some of the pills have been found to take too long to dissolve. [New York Times] The Soviet Union ridiculed Aleksandr Solzhenitsyn's new expose of the Soviet prison system as a "blanket slander of the Soviet people," born of the author's "impotent rage" against Communist achievements. In the first authoritative Soviet comment on Mr. Solzhenitsyn's "Gulag Archipelago," the official Soviet press agency gave no hint of what actions might be taken against the author or the book's foreign publishers. [New York Times] Secretary of State Kissinger and Israel's Defense Minister, Moshe Dayan, will meet in Washington on Friday, with the administration reasonably certain that the results of the Israeli parliamentary election, in which the governing Labor party lost about five seats, will not impede the Geneva peace talks. Mr. Dayan is also expected to talk with the Pentagon officials about military supplies for Israel. [New York Times] The monthly food market reports follow: In Chicago, the cost of meat and dairy products has soared. Groceries which last March cost $19.99 are now $23.93. In Los Angeles, fruits and vegetables are up. A $20.00 basket of groceries last March now costs $21.78. In Atlanta, many grocery prices have increased. Items which added up to $20.00 last March now cost $22.58. In New York City, a basket of goods which were priced at $20.01 last March is now up to $20.99. [CBS] Israel and Egypt announced that they had reached an "important stage" in their secret negotiations on disengagement of their forces along the Suez Canal front. The one-sentence report issued after the day's session in Geneva shed no light on the issues being discussed by the military working group, which is scheduled to renew the talks on disengagement Friday. [New York Times] The British are holding five Americans who are suspected of being involved in an international arms ring. The five are part of a pro-Arab terrorist group. [CBS] A record number of Jews were allowed to emigrate from the Soviet Union last year. Communist party leader Leonid Brezhnev allowed the increased emigration in return for trade benefits from the United States. [CBS] In the New England Journal of Medicine, two pediatricians reported 43 infants were allowed to die at Yale University's hospital in New Haven because of deformities. At that hospital, doctors and parents decide if a child is too deformed to lead even a partially-normal life. Modern technology contributes to the problem of a deformed infant by sustaining the lives of "nature's accidents". One mother described the suffering and pain of her deformed child who was not allowed to die; at 10 months, the baby finally died. [CBS] China disclosed a major military shake-up; the action appears to strengthen Chou En-lai's position. [CBS]

Stock Market Report

Dow Jones Industrial Average: 855.32 (+4.46, +0.52%)
S&P Composite: 97.68 (+0.13, +0.13%)
Arms Index: 1.48

	Issues	Volume*
Advances	1,070	6.78
Declines	431	4.05
Unchanged	287	1.23
Total Volume		12.06

* in millions of shares

Arms Index is the ratio of volume per declining issue to volume per advancing issue; a figure below 1.0 is bullish.

Market Index Trends
Date	DJIA	S&P	Volume*
December 31, 1973	850.86	97.55	23.47
December 28, 1973	848.02	97.54	21.31
December 27, 1973	851.01	97.74	22.72
December 26, 1973	837.56	95.74	18.62
December 24, 1973	814.81	92.90	11.54
December 21, 1973	818.73	93.54	18.68
December 20, 1973	828.11	94.55	17.43
December 19, 1973	829.57	94.82	20.67
December 18, 1973	829.49	94.74	19.49
December 17, 1973	811.12	92.75	12.93