Stocks Mixed in Heavy Trading; Dow Off 4.30
The stock market settled for a mixed showing Thursday, pausing after its broad-based rally of the past three weeks.
Analysts said some traders were following a natural urge to take profits, with stock prices having come a long way in a short time.
The Dow Jones average of 30 industrials, up about 7 points at midday, closed with a 4.30 loss at 1,270.43.
But advances outnumbered declines by about six to five on the New York Stock Exchange, marking the 14th consecutive session in which gainers have been in the majority.
Eighth-Largest Volume
Volume on the Big Board came to 160.74 million shares, the eighth-largest total on record, against 144.43 million Wednesday.
The market’s early 1985 rally hasn’t been as dramatic as the brief but powerful upsurge it staged last summer. But Wall Street analysts say it has been more impressive in many ways--most notably in its staying power.
From Jan. 4 through Wednesday, the Dow Jones industrial average rose almost 90 points. It is within striking distance of the all-time closing high of 1,287.20 set Nov. 29, 1983.
Some other leading market indicators have surpassed their previous peaks this week.
The revival of enthusiasm for stocks has been attributed to a stimulative credit policy by the Federal Reserve, signs of a pickup in the pace of economic growth, continued low inflation and declining interest rates.
Optimism about the future course of Fed policy got a lift late Thursday from word of a larger-than-expected $2.8-billion drop in the basic measure of the money supply for the week ended Jan. 14. Most economists surveyed Tuesday had expected a decline of about $900 million.
Prices of long-term government bonds, which move in the opposite direction from interest rates, posted gains ranging from about $10 to near $20 for every $1,000 in face value.
The Big Board’s composite index of all its listed common stocks slipped 0.24 to 102.03.
Nationwide turnover in NYSE-listed issues, including trades in those stocks on regional exchanges and in the over-the-counter market, amounted to 190.48 million shares.
Standard & Poor’s index of 400 industrials dropped 0.67 to 198.01, and S&P;’s 500-stock composite index was down 0.59 at 176.71.
The NASDAQ composite index for the over-the-counter market rose 1.62 to 272.34.
At the American Stock Exchange, the market-value index closed at 219.57, up 0.37.
The Wilshire index of 5,000 equities closed at 1,812.028, down 1.727.
Large blocks of 10,000 or more shares traded on the NYSE totaled 3,220, compared to 2,882 on Wednesday.
Good Economic News Helps
In the credit markets, yields on 30-year Treasury bonds fell to 11.19% from 11.33% late Wednesday and 11.53% at the end of last week.
In the secondary market for Treasury bonds, prices of short-term governments rose 1/8 point, intermediate issues rose 9/32 point to 3/4 point and long-term issues climbed 1 point, according to the investment firm of Salomon Brothers Inc.
On Tuesday, long-term Treasury bonds climbed as much as 1 3/8 points. They followed up on Wednesday by rising another 10/32 point.
Among tax-exempt municipal bonds, general obligations rose 1/2 point in light activity and revenue bonds were up 1 point in heavy trading.
Yields on three-month Treasury bills were unchanged at 7.61%. Six-month bills were also unchanged at 7.89% and one-year bills were up 2 basis points at 8.20%. A basis point is one-hundredth of a percentage point.
The federal funds rate, the interest on overnight loans between banks, traded at 8.5%, up from 8.475% late Wednesday.
