October 17, 1991

One day after Citicorp announced a surprising $885 million loss and eliminated its dividend on common stock, the banking company's chairman, John S. Reed, told analysts that cutting expenses and selling nonessential businesses remained the centerpieces of the company's plan to restore financial health. Citicorp, the nation's largest banking company and parent of Citibank, described the same moves last December, but now more cost-cutting is required, Mr. Reed said, because revenues in Citicorp's consumer and corporate banking businesses have declined recently, and they show no signs of increasing soon.

Markets Stock prices rose smartly on the strength of corporate earnings that exceeded expectations. The Dow capped a five-day rally to vault to a new high, 3,061.72, up 20.35. [ Page D1. ] Prices of Treasury securities slipped a bit in slow trading. [ D21. ]

Hoping to influence NATO and European Community summit meetings in the next two months, France and Germany called today for creation of a corps-strength Western European army as a step toward giving the region an independent defense capability. The two Governments said they would strengthen an existing 5,000-member French-German brigade and indicated that units from other countries in the European Community could eventually join the force. Officials here in Paris said the expanded French-German force could have 30,000 troops.

Stock prices rose smartly yesterday on the strength of corporate earnings that exceeded expectations and were free of jolting surprises. The Dow Jones industrial average capped a five-day rally to vault past the high it set less than two months ago, and some other indexes continued plowing into record territory. The Dow ended the day at 3,061.72, up 20.35 points, in heavy trading. That represented a gain of 115 since Oct. 9 and surpassed the previous best level, 3,055.23, set on Aug. 28.

New York City's streets, already festooned with signs that tell the time, the temperature and the national debt, will soon have signs that provide air pollution readings, Mayor David N. Dinkins said today at a meeting here of leaders of the world's major cities. He said the plan is to install monitors at pollution "hot spots" throughout the city to increase public awareness of the problem.