BIZWATCH : MARKETS.

MARKET LOGIC: Wall Street sobered up with a smile. The Dow Jones industrials gained ground in calm trading after Tuesday's somersaults and the Nasdaq composite index had its biggest point gain ever. Stocks found their legs as investors got encouraging news on corporate earnings and at least ambiguous news about economic growth and inflation. The Dow Jones industrial average finished up 18.12 points at 5,376.88. The gain in heavy trading was a huge relief.

MEMO INSURANCE POLICIES: A company that buys life insurance policies from the terminally ill, giving them a source of up-front cash, will suspend the practice because new developments in treating AIDS could hurt profits. Dignity Partners Inc. of San Francisco was among the first companies to offer the discounted payments for the right to collect a policy's full benefits after a client's death. In announcing its change, the company cited medical developments such as the recent success of treatments that reduce levels of the AIDS virus to undetectable levels. While such developments are ``welcome news for many, if the treatments are effective in the long term, the company's results will be adversely affected,'' Dignity officials said.The company noted that more than 95 percent of its business involved policies held by people with AIDS or infected by the AIDS virus.

INTERNET COMMUNICATION: Microsoft and Intel announced a cross-licensing agreement aimed at making it easy to place voice and video calls on the Internet. The companies said they will share technology and develop a standard set of communication protocols. As a result, they said, millions of personal computer users will be able to hold conversations over the Internet regardless of what kind of computer systems they have. Microsoft, the world's largest software company, and Intel, the No. 1 chip-maker, also plan to make it possible for people to find each other on the Internet through a sort of cyberspace white pages.

RESIGNATION PLANS: Teledyne Inc. chief Donald Rice announced that he is resigning, effective with the closing of a merger with Allegheny Ludlum Corp. Rice also resigned his posts as a director and officer of Allegheny Teledyne Inc., the new company that will become the parent of Teledyne and Allegheny Ludlum. The former Air Force secretary will provide consulting services to Allegheny Teledyne, and serve as a nonmanagerial director of the subsidiary through which Teledyne conducts its European operations.

TRAVEL PARTNERS: Pan American World Airways, the start-up carrier that bought the name of the former Pan Am, agreed to merge with Carnival Air Lines. Terms of the deal were no disclosed. Pan Am is awaiting approval from government regulators to begin flights this summer. It owns three planes and plans to fly initially to New York, Los Angeles and Miami. Carnival, based in Fort Lauderdale, has 26 planes and employs about 1,350 people.

FORD INCREASE: With the heavy costs of launching several redesigned cars and trucks behind it, Ford Motor Co. said its second-quarter profit surged 21 percent. Much of that increase was attributed to a record performance by Ford's financial services unit, however. Overall, Ford's worldwide car and truck sales were flat in the April-June period. The No. 2 domestic automaker earned $1.9 billion, or $1.60 a share, compared with $1.57 billion, or $1.45 a share, in 1995.

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