Stocks Mixed in Seesaw Session; Dow Up 1.01

The stock market turned in a narrowly mixed performance Tuesday as it gave up most of its early gains in a seesaw afternoon session.

The gains were widely scattered, while some auto and technology issues were lower. Analysts said the light pace of trading was typical for August and reflected some uncertainty about the state of the economy.

The Dow Jones average of 30 industrials, which fell 6.50 on Monday to its lowest level in seven weeks, edged up 1.01 to close at 1,315.30.

Decliners Outpace Gainers

Declining issues outpaced gainers eight to seven on the New York Stock Exchange. The NYSE composite index fell 0.13 to 108.54.

Big Board volume totaled 80.30 million shares, compared to 77.34 million on Monday.

Fred Fraenkel, director of equity research at Prudential-Bache Securities, said the light pace of trading was partly due to many professional money managers being on vacation. But he said it also may reflect confusion about the economy.

Some Wall Streeters believe the economy is rebounding significantly from its sluggish performance in the first half of 1985, while others say it is continuing to grow slowly.

“There is a lack of conviction about what is going on,” Fraenkel said. “A lot of investors are frozen from doing anything and are uncertain about what to root for and what to root against.”

The latest government economic report is a case in point.

The Commerce Department said retail sales climbed 0.4% last month, the first increase since April. But it also said sales had fallen more than it previously reported in June. The June sales decline was revised to 1.4% from 0.8%.

The Dow Jones industrial average drifted up by nearly 5 points in the morning session but fell nearly eight points below Monday’s close at mid-afternoon before rallying toward the close.

Leading the NYSE’s active list, Middle South Utilities slumped 1 1/8 to 11. There was speculation that it may reduce its common stock dividend in the wake of an adverse court decision on a rate increase request by one of its subsidiaries.

In the auto group, General Motors fell 7/8 to 67 1/8, Ford was down at 43 7/8 and Chrysler was off 7/8 at 35.

In the technology group, International Business Machines was down 1/2 at 126 5/8, Teledyne was off 3 3/8 at 247 and Sperry was off 5/8 at 48 1/2.

Control Data fell 2 1/8 to 23. The computer company said its recent downward revision of earnings put its first-half financial results in violation of restrictions on revolving credit arrangements with its banks. The banks, however, agreed to temporarily relax the restrictions, the company said.

On the plus side, Union Carbide was up 3 at 52 1/8, Beatrice was up at 33 and MGM/UA Entertainment was up 7/8 at 24 7/8.

Revlon rose 1 5/8 to 43 7/8 on speculation that it may be a takeover target.

Bond prices retreated as the government reported signs of economic revival in the July retail sales figures.

In addition, the federal funds rate, the interest on overnight loans between banks, traded at 7.875%, the same as late Monday and up from 7.5% on Friday. The federal funds rate is a benchmark for other short-term interest rates.

In the secondary market for Treasury bonds, prices of short-term governments fell 1/32 point, intermediate maturities slipped 7/32 point and long-term issues were off 1/2 point, according to the investment firm of Salomon Bros.

The Merrill Lynch daily Treasury index, which measures price movements on all outstanding Treasury issues with maturities of a year or longer, fell 0.29 to 105.49 from Monday’s close. The Shearson Lehman daily Treasury bond index, which makes a similar measurement, fell 3.25 to 1,106.98.

In corporate trading, industrials were down point and utilities were off 3/8 point in light trading, Salomon Bros. said.

Among tax-exempt municipal bonds, general obligations and revenue bonds were down 3/8 point in moderate activity.

Yields on three-month Treasury bills rose 2 basis points to 7.12%. Six-month bills fell 1 basis points to 7.34% and one-year bills were up 1 basis point at 7.51%. A basis point is one-hundredth of a percentage point.

Yields on 30-year Treasury bonds were 10.70%, up from 10.62% on Monday.