Stock Market Impact

Speculation that Unocal Corp. might be trying to buy another oil company to fend off the takeover attempt by Texas oilman T. Boone Pickens apparently caused Unocal stock to drop Tuesday. At the same time, the stock of its rumored merger partner, Dallas-based Diamond Shamrock Corp., rose.

In composite trading on the New York Stock Exchange, Unocal fell $1.75 to close at $48. More than 2.2 million shares changed hands, making Unocal the most active issue on the Big Board for the second straight day. Diamond Shamrock’s stock, up $1.25 at $20.50 a share, was the third busiest, with more than 1.4 million shares changing hands.

Spokesmen for both companies declined to comment on whether they are discussing a business combination.