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MICHIGAN STOCK INDEX UP 21 PERCENT IN 1991; BEST GAIN SINCE 1986

 MICHIGAN STOCK INDEX UP 21 PERCENT IN 1991; BEST GAIN SINCE 1986
 DETROIT, Jan. 8 /PRNewswire/ -- The Michigan Equity 100 Stock Index shrugged off recession and a poor auto industry and recorded a 20.7-percent increase in 1991, its strongest gain since 1986. Nationally, stock prices fared even better. The Standard & Poor's (S&P) 500 jumped 26.3 percent last year. The Michigan Equity 100 failed to keep pace with the S&P 500, primarily due to weak stock price performances for the Big Three. In 1991, automotive stocks on average fell 5.8 percent, with Ford rising 5.6 percent, Chrysler dropping 6.9 percent and GM off by 16.0 percent.
 Despite weakness for auto stocks, the majority of Michigan companies fared very well in 1991, led by small to medium-size firms. In 1991, Michigan's secondary stocks had an average gain of 50 percent. In fact, of the 18 Michigan companies which posted gains of 100 percent or better in 1991, all were secondary stocks. "Wall Street sentiment favored smaller stocks in 1991, in part, due to their ability to control costs and achieve modest earnings growth in spite of the recession," according to David Sowerby, vice president and economist at Manufacturers Bank, N.A. Nationally, secondary stocks also had stock price gains average better than 50 percent in 1991. Small to medium-size Michigan firms which enjoyed healthy stock price and profit performance included top performers Spartan Motors (+636 percent) and Thorn Apple Valley (+385 percent). Other strong results, owing to favorable earnings, were reported for Stryker Corporation (+220 percent), Medstat Systems (+170 percent) and Walbro (+122 percent).
 Among the 100 stocks which comprise the Michigan Equity 100, winners outnumbered losers by a strong 4-to-1 ratio. With the exception of the auto and energy sectors, gains were widespread among the state's industries, including the consumer goods, health care and finance sectors which benefited from steady earnings performance. Although corporate profits suffered for the third consecutive year in 1991, these industries exhibited modest earnings growth between 5 percent and 10 percent. In comparison, U.S. corporate profits are expected to fall 8 percent in 1991, and the Big Three have lost $9 billion over the past five quarters.
 For the Michigan Equity 100 to maintain its strong results in 1992, a rebound in corporate profits will be essential. The equity markets' year-end rally, which has extended into the new year, has largely benefited from lower interest rates. To maintain its momentum, both the local and national stock indexes need an improved economy, particularly for corporate earnings.
 The Michigan Stock Index was developed in an effort to gauge the future strength of the local economy, as well as measure Michigan's performance relative to the S&P 500 Index of 500 stocks. Similar to the S&P 500, each company's influence in the Index is based on its market capitalization. Market capitalization is simply the stock price times the shares outstanding.
 MICHIGAN EQUITY 100 TOP 10 PERFORMERS IN 1991
 COMPANY STOCK PRICE STOCK PRICE PERCENT
 12/30/90 12/31/91 CHANGE
 Spartan Motors $2.58 $19.00 635.6
 Thorn Apple Valley 6.50 31.50 384.7
 Sandy Corporation 1.25 6.00 380.0
 Medar Inc. 1.50 5.63 275.0
 Randers Group 0.49 1.75 260.8
 Stryker 15.62 50.00 220.0
 Sparton Corp. 2.88 8.00 178.3
 Medstat Systems 16.00 43.25 170.3
 Rospatch Corp. 3.75 10.00 166.7
 PHM Corp. 9.38 23.50 150.7
 MICHIGAN EQUITY 100 YEAR 1991 PERFORMANCE BY INDUSTRY
 INDUSTRY NO. OF COMPANIES AVERAGE PERCENT CHANGE
 Auto Production 3 -5.77
 Auto Supply 20 56.60
 Heavy Industry 12 25.73
 Consumer Goods 12 113.70
 Energy 9 -2.55
 Technology 15 39.32
 Finance 14 63.91
 Retail 11 30.21
 Health 4 92.41
 -0- 1/8/92
 /CONTACT: David G. Sowerby of Manufacturers Bank, N.A., 313-222-4829/
 (MNTL) CO: Manufacturers Bank, N.A. ST: Michigan IN: FIN SU: ECO


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Date:Jan 8, 1992
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