News stories from Thursday December 2, 1976

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

Cyrus Vance's appointment as Secretary of State in the developing Carter administration is a virtual certainty, according to sources who have spoken with Mr. Carter or Vice President-elect Walter Mondale. Mr. Vance was a former senior official and troubleshooter in the Johnson administration. The nominee for the Secretary of the Treasury is expected to be announced tomorrow. It is believed that he will be A.W. Clausen, president and chief executive officer of the Bank of America, or Irving Shapiro, chairman and chief executive officer of E.I. du Pont de Nemours & Co. [New York Times] Erwin Rebhan, a 50-year-old businessman who has been a close friend of President-elect Jimmy Carter, is the subject of a wide-ranging federal investigation into alleged business fraud and accusations that money from organized crime was funneled into the Atlanta business community. Mr. Rabhan's interests, nearly all of which have failed, have included nursing homes in four states, day care centers, a motion picture studio and a magazine for well-to-do blacks. [New York Times] Retail sales gains abated in November from the highs of October despite cold, seasonal weather and preparations for the Christmas shopping season. Reports from major store chains showed mixed results for November, with most reporting smaller sales advances over November 1975 than they had in October. [New York Times] Stock prices declined slightly, erasing Wednesday's small advance, and leading drug issues set yearly lows. The Dow Jones industrial average dipped 2.74 points to 946.64. The Federal Reserve Bank's announcement of a $2.9 billion decline in the nation's money supply brought a surge of trading activity and new highs for the year in bond prices. New bond issues sold more rapidly. [New York Times] The latest steel price increases were attacked by the Ford administration in criticism that implied that the increases were unjustified and encouraged the steel companies' customers to bargain for discounts. The government's chief price monitor, William Lilley, said at a news conference that at least one steelmaker was reported to be still selling at prices that prevailed before the new rise of 6 to 7 percent went into effect Wednesday. The price increases, he said, were apparently made in anticipation of price controls by the Carter administration. [New York Times] The Federal Reserve Bank of New York reported that the nation's currency in circulation declined by $2.9 billion, to $307.9 billion, in the week ending Nov. 24 on a seasonally adjusted basis. This is another indication that the economic recovery may be faltering. Nevertheless, Arthur Burns, the Federal Reserve Board's chairman, still seems reluctant to adopt a expansionary monetary policy urged by Democratic economists and members of Congress. [New York Times] The B-1 strategic bomber's initial production was approved by the Defense Department, but under a contractual arrangement that will give the Carter administration five months to consider whether to continue one of the most expensive weapons programs ever undertaken by the Pentagon. Defense Secretary Donald Rumsfeld said that it was "in the national interest" to proceed with its production. [New York Times] Leonid Brezhnev has given what seems to be an indication of a desire in Moscow to cooperate with the Carter administration. A spokesman for Mr. Carter said that the Communist Party leader had said that Moscow would "go out of its way" to avoid any crisis with the United States at the outset of the new administration. The message was said to have been relayed through Treasury Secretary William Simon, who recently was in Moscow. [New York Times] China's Foreign Minister was dismissed by the government, and Huang Hua, representative at the United Nations, was appointed to replace him. No reason was given for the dismissal of Chiao Kuan-hua, but he was said to have been accused of having ties to Mao Tse-tung's widow, Chiang Ching, and three other purged Politburo members. [New York Times] Mao Tse-tung's government in the 1960's built long tunnels in Dairen, along Northern China's border, as a precaution against an attack by the Soviet Union. The Dairen tunnels are more than 60,000 yards long and can shelter 50,000 people. They are similar to underground shelters constructed in Peking, Mukden and other major Chinese cities. Shelters also were built under farming communities. [New York Times] Mariano Rumor, Italy's former Prime Minister, and two former Defense Ministers were accused by a committee of Parliament of corruption and fraud in bribery scandals involving Lockheed Aircraft Corporation. The former Defense Ministers are Luigi Gui and Mario Tanassi. They and Mr. Rumor are members of Parliament. All have denied the charges. [New York Times]

Stock Market Report

Dow Jones Industrial Average: 946.64 (-2.74, -0.29%)
S&P Composite: 102.12 (-0.37, -0.36%)
Arms Index: 1.14

	Issues	Volume*
Advances	763	9.65
Declines	667	9.61
Unchanged	483	4.04
Total Volume		23.30

* 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 1, 1976	949.38	102.49	21.96
November 30, 1976	947.22	102.10	17.03
November 29, 1976	950.05	102.44	18.75
November 26, 1976	956.62	103.15	15.00
November 24, 1976	950.96	102.41	20.42
November 23, 1976	949.30	101.96	19.09
November 22, 1976	955.87	102.59	20.93
November 19, 1976	948.80	101.92	24.55
November 18, 1976	950.13	101.89	24.00
November 17, 1976	938.08	100.61	19.90