Dow Rises 1.72 to New High in Seesaw Session

Stock prices swung widely Tuesday and the Dow Jones industrial average ended with a modest gain in the busiest trading session since last January.

In the bond market, prices advanced strongly, pushing yields on 30-year Treasury issues toward 10% and their lowest levels since mid-1980. Short-term interest rates, however, were little changed.

The Dow Jones average of 30 industrials, which crossed over the 1,400 threshold for the first time last week and set a record Monday, finished up 1.72 at a new closing high of 1,433.60. It marked the seventh time in the past 10 sessions that the blue-chip index has closed at a new peak.

Particularly encouraging to Wall Streeters was the fact that the market managed to hold onto the gains made Monday when a powerful surge in stock prices propelled the Dow index up more than 27 points for the best one-day performance in 10 months.

Busiest Since Jan. 22

Volume on the New York Stock Exchange reached 170.80 million shares, up from 126.54 million on Monday, which was itself a strong level considering the absence of traders observing Veterans Day.

The latest volume was the heaviest since Jan. 22, when 174.77 million shares changed hands. The record, set on Aug. 3, 1984, stands at 236.57 million shares.

“The fact that stocks had enough umph to finish with a modest increase was encouraging,” said Jack Baker, head of block trading at Shearson Lehman Bros. in New York.

The market meandered as the session progressed. The Dow Jones industrial average moved as low as 1,421.10 in the first hours of trading and climbed as high as 1,446.10 in the afternoon.

Baker said buying programs by major brokerages led to much of the upward movement during the course of the session. The institutions stepped in to take advantage of favorable spreads between stock market prices and futures and options prices.

Secondary Issues Join Rally

Michael Metz, a vice president at Oppenheimer & Co. in New York, said the enthusiastic attitude among investors that has recently set the tone for trading has spread throughout the stock market so that secondary issues are now joining in the advance.

In the daily tally on the Big Board, advancing stocks outnumbered losers by more than better than two to one. The exchange’s composite index, which hit a record high Monday, rose another 0.51 to 114.33.

Nationwide turnover in NYSE-listed issues, including trades in those stocks on regional exchanges and in the over-the-counter market, totaled 201.13 million shares.

Large blocks of 10,000 or more shares traded on the NYSE totaled 3,393, compared to 2,608 on Monday.

Standard & Poor’s index of 400 industrials rose 0.82 to 219.63, and S&P;’s 500-stock composite index was up 0.80 to 198.08. The S&P; 500’s previous high occurred Monday.

Among actively traded blue chips, Ralston Purina closed down 1 3/8 at 47 5/8. American Telephone & Telegraph ended up 1/2 at 22, and IBM was up 3/4 at 135 3/8.

Also on the list of most actively traded issues, Citicorp rose 1 5/8 to 46 5/8 and Sears, Roebuck was down 1/8 to 36 1/2.

The market for Treasury notes and bonds had been closed Monday in observance of the Veterans Day holiday.

The investment firm of Salomon Bros. said the prices of long-term government bonds moved higher as trading opened Tuesday and finished up by nearly a full point, or $10 for every $1,000 in the bond’s face value.

That pushed yields on 30-year bonds to 10.04% from 10.12% late Friday. The last time yields on Treasury bonds traded below 10% for a sustained period of time was in June, 1980, the investment firm said.

Also in secondary trading of Treasury securities, Salomon Bros. said prices of short-term governments rose 1/8 point and intermediate maturities rose by between point and 18/32 point.

The Merrill Lynch daily Treasury index, which measures price movements on all outstanding Treasury issues with maturities of a year or longer, rose 0.45 to 108.29 from Friday’s close. The Shearson Lehman daily Treasury bond index, which makes a similar measurement, rose 3.59 to 1,134.62.

In corporate trading, industrials rose 3/4 point in active trading, while utilities were up 1/2 point in light trading.

Among tax-exempt municipal bonds, general obligations rose 1/2 point in moderate activity and revenue bonds were up 5/8 point in active trading.

Yields on three-month Treasury bills slipped 1 basis point to 7.23%. Six-month bills fell 2 basis points to 7.26%, while one-year bills were off 2 basis points at 7.29%. A basis point is one-hundredth of a percentage point.