Mr. Zonis, writing to clients over the weekend, said it was ''unlikely'' that the president would persuade Republicans to support new American initiatives. Mr. Zonis contended that ''the worldwas closer to a global meltdown with disastrous economic and political consequences than it had been at any time since World War II.'' On Monday, however, the prevailing view was that the government would be unlikely to interfere with a healthy U.S. economy, which is widely expected to grow at about 2 percent annually in the coming few years, even by analysts who are concerned that corporate profits may be limited by global economic weakness. Investors are sticking to the well known-names and looking for bargains,'' he said, rather than placing more aggressive bets on riskier companies that would prosper in a rapidly expanding global economy. Mr. Ackerman said, identifying General Electric, Sara Lee and Guilford Mills as three companies meeting these criteria. Sara Lee and Guilford Mills rose on Monday, but GE fell.
Investors remain nervous about weak profit prospects.
Walt Disney fell 5 percent after the entertainment company warned Friday that its fourth-quarter earnings would drop from 1997 levels because of a reduced Asian appetite for its videos and weakness in its movie business. Advancing issues included banks, which have been sensitive to the international economic crisis.