(MONEY Magazine) – NOW YOU CAN CALL BEANTOWN "BOOMTOWN." In the second quarter of 1995, stocks of firms based in Boston shot up 16.6%, outperforming those of the other 23 metropolitan areas in the exclusive Money/Nordby Cities Index. The average city gained 9.3%. At the other end of the spectrum, Miami's scant 0.2% increase landed it in last place, in a complete reversal of its ranking last quarter.

The Money/Nordby Index is composed of a group of 24 indexes for 24 major cities, each consisting of shares of 12 companies with headquarters in a single metropolitan area. Every stock is equally weighted in its local index, which measures changes in share prices only; dividends are not included.

After placing 20th in the first quarter of this year, Boston was lifted dramatically by bank stocks, plus Lotus, the $971 million software firm that was the beneficiary of a takeover announcement by IBM. Lotus was up a huge 66.7%, the largest increase of any of the 288 stocks in the index. Phoenix finished second, up from sixth place, with a 16.5% increase in its stocks, and Dallas rose to third place from 17th with a 15.8% gain.

Lotus' leap came after the stock had dropped 6.7% in the first quarter on disappointing earnings. Its shares would likely have remained underachievers had not IBM made its offer in early June. Boston's second-place finisher was Bank of Boston ($43.5 billion in assets), whose shares rose an impressive 25.5%. The stock had been pummeled because the bank is a big corporate lender in Latin America, which is only now recovering from the so-called tequila effect-the reaction to the devaluation of the Mexican peso. The $11.4 billion (in assets) BayBanks was third, up 22.9% on the strength of takeover rumors.

Microage, the $2.2 billion information technology firm, lead the way in Phoenix. Its expanding share of the expanding microcomputer market pushed this stock up 48.1%. Continental Homes, a $432 million builder of single-family houses, was another big winner. Its price was up 41.8%, also on the strength of a growing market share.

In Dallas, Texas Instruments announced a 36% dividend increase and a two-for-one stock split and-lo and behold!-the $10.3 billion semiconductor stock rose 51.3%. Congress' proposals to increase competition in the telecommunications industry boosted the stock of DSC, a $1 billion maker of telecommunications equipment, 42.8%.

Meanwhile, Miami melted. After its 12 stocks averaged a 12.7% gain in the first quarter, seven of them fell in the second quarter, most notably the $1.2 billion cruise line Royal Caribbean. Soft sales and increasing pressure from its competitor Carnival Cruise Lines depressed the stock, which was down 15.8%. Cordis, a $416 million manufacturer of diagnostic devices lost 8.3% of its market value as Wall Street revised its overly optimistic earnings projections. Finally, Wackenhut, the nation's second largest provider of prison management services, which had been up 50.7% last quarter, fell 7.8% as investors decided to take some of their profits.

--Malcolm Fitch