August 4, 1989

LEAD: Stung by a veto threat by President Bush, Congressional conferees and Administration representatives tonight hammered out a compromise agreement on financing the sweeping savings and loan rescue plan that hit a stalemate earlier in the day.

LEAD: Japanese in Research Deal In an unusual joint venture, Harvard's teaching hospital is accepting $85 million from Japan's leading cosmetics company to create a skin research center. Page A8. Sandinistas Halt the Draft Meeting an opposition demand, Nicaragua said it would suspend the military draft until after elections scheduled for February.

LEAD: Samuel R. Pierce Jr., the former Secretary of Housing and Urban Development, was instrumental in providing Federal assistance to friends, former aides and prominent Republicans who sought his help, correspondence from his eight-year tenure shows.

LEAD: The main campaign event one day recently was in a Suffolk County park to which thousands of elderly people from Queens and Brooklyn had been bused. Edward I. Koch, New York Mayor and mayoral candidate, dropped in by helicopter, conducted a blitzkrieg tour of the picnic area, spoke briefly over a fuzzy public-address system and helicoptered out.

LEAD: MANO DE BRONCE: Hand of Bronze.

LEAD: Enticed by the huge profits reaped by selling cocaine and crack, drug trafficking organizations have expanded beyond the nation's cities into rural states like Iowa and Wyoming, the Justice Department reported today.

LEAD: Through the winter and spring, many economists expected wages to rise sharply. This wage spiral would be the inevitable result of the nation's low unemployment rate: companies would be forced to bid for scarce workers, and wages would finally behave as they once did - rising briskly for millions of people.

LEAD: The Securities and Exchange Commission yesterday charged two New York investors with participating in a scheme to defraud more than 100 brokerage firms, including Merrill Lynch, Bear, Stearns, Prudential-Bache and Shearson Lehman Hutton.

LEAD: The Government said today that its chief economic forecasting gauge declined in June for the fourth time in five months, renewing concerns that the longest economic expansion in peacetime history may be nearing an end.

LEAD: Three school superintendents in other major cities have emerged as the front-runners for schools chancellor in New York City, Board of Education officials and others said yesterday.

LEAD: ECONOMY Congressional conferees hammered out a compromise agreement on financing the savings and loan bailout that is acceptable to the Administration. Under the agreement, $20 billion of the bailout will be put on the budget and the remaining $30 billion will go on other Government accounts.

LEAD: President Bush was prepared to order an air strike against suspected terrorist strongholds in Lebanon if kidnappers had carried out a threat to kill an American hostage, Administration officials said today.