Market Drifts in Slow Trading; Dow Off 4.37
stock market drifted to a moderate loss Monday in selling ascribed to worries over the outlook for corporate profits.
The Dow Jones average of 30 industrials dropped 4.37 to close at 1,324.37.
Volume on the New York Stock Exchange slowed to 95.55 million shares, compared to 101.17 million on Friday.
Investors got some upbeat news over the weekend from a group of corporate purchasing executives.
New Orders Gain
In reporting the results of a monthly survey, the National Assn. of Purchasing Management said production and new orders registered significant gains in September, “suggesting new strength in the economy.”
But analysts said investors still seemed to be worried about forthcoming earnings reports for the third quarter.
Two companies, Hospital Corp. of America and Burroughs, jolted the market last week with earnings disappointments. In Monday’s trading, HCA fell 1 1/2 to 28 and Burroughs was down 1 at 54 1/2.
Brokers said the market was also unsettled by talk that Paul A. Volcker might be planning to leave the chairmanship of the Federal Reserve. The Fed has strongly denied recurring rumors of a resignation by Volcker, who is highly regarded by many Wall Streeters.
Revlon climbed 1 to 55. Pantry Pride raised its offer for the company to $56.25 a share, bidding to counter a proposed plan to take Revlon private through a leveraged buy-out.
Warner-Lambert tumbled 4 to 34 and led the active list on turnover of more than 2 million shares. The drop was blamed on concern about prospects for an anti-arthritic drug produced by the company.
Conversations With Officials
Warner-Lambert said it had conversations with French regulatory officials about reports of skin reactions to the drug in some patients. The company also said the drug, which is awaiting approval to be marketed in the United States, has been shown in extensive tests to be effective and well tolerated when used as directed.
Monsanto, also active, fell 5 5/8 to 41 1/8. Its G. D. Searle subsidiary said several hundred suits have been filed alleging problems associated with Searle’s Copper 7 contraceptive device.
Searle said it stood behind the product and considered it safe when used as directed.
ASK Computer Systems, traded in the over-the-counter market, dropped 2 7/8 to 7 3/4 on a company projection of lower than expected revenue and earnings for the quarter ended Sept. 30.
Losers outnumbered gainers by about five to three on the Big Board.
Large blocks of 10,000 or more shares traded on the NYSE totaled 1,709, compared to 1,930 on Friday.
In the bond market, prices fell as traders looked ahead to what may soon prove to be a flood of new Treasury issues.
In secondary trading of short-term Treasury securities, yields on three-month Treasury bills rose 6 basis points to 7.07%. Yields on six-month securities rose 5 basis points to 7.31%.
