IMPACT OF THE GULF WAR : O.C. Firms See Stocks Rise in the Buying Binge : Wall Street: The rally, spurred by early expectations of a quick war, pushes up shares of 51 of the top 100 public, locally based companies.

The stocks of Orange County companies, which as a group have been in the doldrums in the last year, were swept up Thursday by the euphoria of Wall Street, but local investors showed little enthusiasm for joining in.

The majority of local public companies saw their shares rise as part of a nationwide buying binge--spurred by expectations of a quick Persian Gulf War--that pushed the Dow Jones average of 30 industrial stocks up 114.6 points to close at 2623.51.

But with Iraq attacking Israel late Thursday after the stock markets closed, the euphoria may be short-lived.

The rally pushed up stock prices of 51 of the top 100 public firms based in Orange County. The high-technology, drug and medical, and retail groups fared the best.

The biggest local winner was Fluor Corp., a worldwide engineering and construction firm based in Irvine. Fluor closed at $39.25 a share, up $3.125 a share, in part on speculation that its services would be in big demand in the postwar Middle East.

Fluor was working on a number of projects in Saudi Arabia. Its stock was hurt when Iraq invaded Kuwait in August. The company, which has worked in the Middle East since the 1940s, could benefit from rebuilding projects after the hostilities end.

The stock of Irvine computer maker AST Research Inc. jumped $2.875 a share to close at a record high of $40.125 a share, mainly on the strength of stronger-than-expected earnings for its second fiscal quarter, which ended Dec. 28. AST reported a quarterly net income of $16.3 million, more than twice the earnings in the same quarter a year ago.

Gish Biomedical Inc. in Santa Ana and Advanced Logic Research Inc. in Irvine also showed strong upswings in their stock prices.

James Richardson, ALR’s chief financial officer, said his firm’s stock rose mainly on the strength of rival AST’s earnings. “We’re in the same business, and some of it rubbed off on us,” he said.

Gish, which had a $3,000 order on the loading dock waiting to go to Kuwait when Iraq attacked, has been positioning itself as a growth company, and traders have responded, said Jack Brown, Gish’s chairman and president.

Most Orange County stocks trade on the over-the-counter markets, which did not show the same strength as the blue chip Dow index. And there was little indication that small local investors were jumping into the market in such uncertain times.

“I’m planning on taking a wait-and-see attitude,” said Larry Wesemann, a transportation planner for a private company in Tustin. “I think it’s going to be a long war, not something that’s going to end in a day or two.”

Kenneth Coatsworth, an Irvine accountant, also believes the market is too volatile for small investors. He took his money out of stocks and bonds some time ago.

“You just don’t know what’s going to happen with the war,” he said.

Doug Candler of San Clemente, a retired U.S. Steel executive, said he pulled his money out of stocks and most bonds on Christmas Eve, but may soon start investing again--a little bit at a time.

“I was very tempted to buy today, but I think the market overreacted, and I think we haven’t heard the last of (Iraqi leader) Saddam Hussein,” he said.

Brokers also said that while trading generally picked up Thursday, it was barely back to the normal rate of a few months ago.

“I can’t tell you the phone has rung off the hook,” said John Hales, a partner in the Newport Beach office of Crowell, Weedon & Co. “It was very quiet before. Now it’s less quiet.”

Virginia Morrow, manager of the Fidelity Investments office in Irvine, said the number of walk-in customers at the discount brokerage was normal Thursday, although “phone volume” was up slightly.

The stock rally was a “bullish event,” said Scott Sabins, manager of Crowell, Weedon’s Laguna Hills office, but “the thing that is really going to move this market is getting the economy to improve.”

“The war is pretty much factored in to these prices,” he said. “We need to get the economy turned around to get the stock market turned around.”

The prevailing view among economists and others is that a short war with Iraq would have little effect on the economy, but a long, protracted war would be very damaging.

ORANGE COUNTY WINNERS Associated Press Stocks of Orange County companies participated in the market rally prompted by the war against Iraq. Fluor Corp., the Irvine engineering and construction firm, was the biggest gainer, because more Middle East work is expected for the company when hostilities end. The high-tech, medical and retail sectors were also very strong.

Thursday Company Business Closing Change Advanced Logic Research Microcomputer systems $10.75 $1.50 Allergan Eye and skin care products 19.63 0.75 AST Research Electronics 40.13 2.88 Bergen Brunswing Drug and health care 28.50 0.87 Birtcher Medical Medical devices 8.00 1.00 Bridgford Foods Frozen food products 14.00 0.88 Ceradyne Aerospace 4.38 0.63 Community Psych. Centers Psychiatric hospitals 26.38 0.88 Fluor Engineering and construction 39.25 3.13 Gish Biomedical Medical devices 9.25 1.00 PDA Engineering Computer software 9.50 0.75 PacifiCare Health Health care 15.75 0.75 Quiksilver Beachwear 12.00 0.63 Tokos Medical Home health care 13.13 0.75

Source: Newport Securities Corp.