Stocks Advance Late in Session; Dow Rises 4.37
The stock market posted a modest advance Tuesday, but a closing surge sputtered in the final moments to leave the Dow Jones industrial average a shade below the record level established only two sessions earlier.
Several transportation and utility issues were among the gainers. Some energy issues were lower amid continued speculation that oil prices might fall.
The Dow Jones average of 30 industrials, which fell 4.48 on Monday, recovered most of that, rising 4.37 to close at 1,315.30. That was just below last Friday’s record close of 1,315.41.
Advancing issues led declines by nearly two to one on the New York Stock Exchange, whose composite index finished up 0.45 at 110.06.
Big Board volume was 115.42 million shares, compared to 125 million on Monday.
The market opened lower but reversed course by noon and drifted listlessly for most of the afternoon.
But prices made a sprint in the final hour, lifting the Dow Jones industrial average above its previous record close with 30 minutes left in the session. The widely watched market gauge slipped back in the final moments.
“It was a dull, quiet day most of the day, and then, in the last hour, we had a pop,” said Lew Smith, a stock market analyst for the investment firm Bear, Stearns & Co. He said he was not certain what caused the closing surge.
Michael Metz, a stock market analyst for Oppenheimer & Co., said at least one major institutional buyer began purchasing stocks late in the day, and other traders joined in “to pick over some of the laggards” among the blue-chip issues.
BankAmerica was the most actively traded issue on the Big Board, falling 1 7/8 to 19 7/8 after the company said it is experiencing higher losses than expected on foreign, commercial real estate and agricultural loans and that its second-quarter earnings will be near the break-even point. A block of 731,000 shares was traded at 20, while a 429,000-share block traded at 20.
Nabisco Brands, which has agreed to a $4.9-billion merger with R. J. Reynolds Industries, was off 1/8 at 81 1/2. Some analysts had expected a higher price.
Beverly Hills-based Litton Industries’ stock rose 2 to 86 5/8 in heavy trading. A company spokesman speculated that the rise was due to the start of trading in notes that Litton plans to exchange for stock beginning June 24 as part of its previously announced financial restructuring. The Securities and Exchange Commission on Tuesday qualified the $1.3-billion debt issue for trading over the counter on a “when issued” basis.
Among the gainers of more than a point, Ford Motor jumped 1 1/8 to 44 1/2 and RCA was up 1 1/2 to 45 5/8.
In the bond market, prices finished mostly higher, resuming the broad and robust rally of the past two sessions.