AT and T's decision to cut 40,000 jobs and take a $6 billion (£3.75 billion) charge for its planned split into three companies sent the Dow Jones soaring 60.33 points to close at 5,177.45.
About 70 per cent of the job cuts are expected by the end of 1996, according to a statement. AT and T employs over 300,000
The group will take a restructuring charge against fourth quarter earnings of about $4 billion (£2.5 billion) after tax which will cut earnings per share by $2.50.
The charge, about $6 billion before tax, is intended to cover its division into three independent companies.
With AT and T's annual revenues of more than $67 billion, the break up ranks as the biggest in US history.
AT and T took over from the original Bell company, created by Alexander Graham Bell, the inventor of the telephone, at the turn of the century.
:quality(70)/cloudfront-eu-central-1.images.arcpublishing.com/irishtimes/VR3765MFOBH2NMV2QNICYDF67M.png)