July 30, 1997

Stocks Set Records, With the Dow Up 53 Stocks reached new highs, buoyed by economic reports that pointed toward low inflation and moderate growth. The Dow industrials surged 53.42 points, to 8,174.53. Financial companies, American Express in particular, and companies that tend to prosper when the economy is doing well, like Caterpillar, were the catalysts. $(Page D8.$)

Northwest Airlines Corp and KLM Royal Dutch Airlines are close to ending their two-year-old legal battle by agreeing to have Dutch carrier sell its 19 percent stake in Northwest back to United States company; settlement could end bitter boardroom and courtroom fight over KLM's investment in Northwest that at times has threatened to undermine their operating alliance, which is one of most successful in airline industry (M)

Malcolm Shabazz is characterized in Family Court as disturbed youngster with history of setting fires and psychotic episodes dating to early childhood, but with no conscious intention of harming his grandmother, Dr Betty Shabazz, when he set fire that killed her; portrait of boy suffering from severe mental illness emerges in testimony by Dr Elizabeth Osborn, psychologist, Dr Don Heacock, psychiatrist, and Joseph DeCarlo, Westchester County probation officer (M)

Legislation awarding $22 million to create group homes for 500 developmentally disabled people is signed into law on July 29 (New Jersey Daily Briefing) (S)

German workers fear competitive global economy poses threat to nation's economic miracle, which produced ever-shrinking work hours and ever-expanding income; suspect that employers demanding longer working hours at less convivial times will win battles with unions seeking more leisure time; employers argue that people will have to work longer and reduce leisure time if Germany is to revive the competitiveness on which its export-driven economy depends; graph (M)