DOW SOARS 103 POINTS IN APPROACH TO 7,000.

Byline: Bruce Meyerson Associated Press 

The Dow Jones industrial average soared more than 100 points Wednesday, shooting toward the 7,000 mark only four months since it first crossed 6,000.

Broader measures also rallied over the last two hours of trading, with the Standard & Poor's 500 list breaking past the 800 mark for the first time.

The Dow jumped 103.52, or 1.5 percent, to 6,961.63. It was the fifth biggest point-gain ever for the Dow, which first hit the 4,000 mark less than two years ago. It was the 11th new high for the Dow this year, bringing the famed blue-chip average's 1997 gain to nearly 8 percent.

There were no significant economic developments to spur Wednesday's rally, which analysts attributed in part to a report confirming that money continued to pour into mutual funds last month, reinforcing the demand for stocks.

After a surprisingly sharp advance in the first three weeks of the year, the stock market has stumbled several times amid worries prices had risen too far, too fast. But with last month's inflation and interest rate worries giving way to the more optimal economic outlook that dominated the second half of 1996, investors are growing less fearful of a severe pullback.

``Equity investors truly believe that the Federal Reserve has no reason to move interest rates to the upside'' to slow the economy as insurance against rapid inflation, said Ned Riley, chief investment officer at the Bank of Boston. He noted Tuesday's report showing that productivity improved sharply in the final months of 1996, helping keep inflationary pressures such as rising wages in check. ``There's even some optimism that gthere's a possibility of a Fed rate cut over the next three-to-four months.''

Investors were also encouraged, analysts said, by the market's late rally on Tuesday, which came despite the recent profit-taking in the high-flying technology sector.

``The tech stocks were weak in last several sessions and that did not translate into much weakness elsewhere, and that was encouraging to traders,'' said Ricky Harrington, a technical analyst at Interstate/Johnson Lane in Charlotte, N.C. ``Yesterday (Tuesday), we had a huge rally during the last hour, and nothing changed overnight to interrupt that momentum.''

Traders were also cheered, Harrington added, by news that the mutual fund industry enjoyed its best month in a year. There was a net inflow of $27 billion in new investment money into stock and bond funds, according to a preliminary estimate by the Investment Company Institute.

A strong earnings report from a key technology concern, meanwhile, helped stem the profit-taking in that sector. Applied Materials, the leading manufacturer of equipment to make computer chips, reported late Tuesday an 83 percent drop in its first-quarter earnings. But the results were stronger than expected, and the report showed impressive growth in orders.