Dow Index Up 4.97 as Interest Rates Decline
The stock market closed out a losing week Friday with a modest technical rally helped by declining interest rates.
The Dow Jones average of 30 industrials climbed 4.97 to 1,247.24, cutting its loss for the week to 27.94 points.
Volume on the New York Stock Exchange tailed off to 94.87 million shares from 107.74 million Thursday.
The Dow Jones industrial average’s loss for the week was its largest since it gave up 29.70 points in the week of March 4-8.
The government reported Friday morning that the civilian unemployment rate was unchanged at 7.3% last month.
Interest Rates Drop
But behind that seemingly neutral number, analysts said, were signs of continuing sluggishness in the manufacturing sector of the economy. For example, the figure for the average factory work week declined.
The news sent interest rates lower in the credit markets. Prices of long-term government bonds, which move in the opposite direction from interest rates, rose about $5 on average for every $1,000 in face value.
Rates on short-term Treasury bills fell 5 to 10 basis points, or hundredths of a percentage point.
Adding to the impetus of lower rates was talk of a possible reduction in the Federal Reserve’s discount rate.
However, brokers said, the latest employment data also had some negative implications for stock traders, reinforcing fears of continuing weakness in corporate profits.
Houston Natural Gas rose 5/8 to 67 3/4, and InterNorth dropped 1 1/8 to 46 7/8. The companies announced plans Thursday for InterNorth to acquire Houston Natural Gas for $70 a share.
Blue-Chip Gainers
Among actively traded blue chips, International Business Machines climbed 3/4 to 125, General Motors 1/2 to 67 1/2 and American Telephone & Telegraph 1/8 to 21 1/8.
E. F. Hutton rebounded 2 1/2 to 31 1/2 after falling 3 1/2 points Thursday, when the company pleaded guilty to violating mail- and wire-fraud laws in connection with the handling of its bank checking accounts between 1980 and 1982.
Atlantic Richfield slipped 1/8 to 62 3/4 and led the active list on volume of more than 3 million shares. The issue rose sharply earlier in the week after the company announced a restructuring and stock repurchase program and also increased its dividend.
Among other energy issues in Friday’s activity, Mobil rose 1 to 33 1/8, Amerada Hess added 1/2 to 32 3/4, Chevron was up 1/8 at 36 7/8 and Amoco slipped to 66 5/8.
The daily tally on the Big Board showed about five issues advancing in price for every three that lost ground.
