Market Continues Its Climb; Dow Up 15.68
The stock market pushed ahead for the third straight session Thursday, aided by hopes for still lower interest rates.
Tobacco issues as a group and some individual stocks responding to favorable earnings reports paced the advance in activity marked by the biggest block transaction ever at the New York Stock Exchange.
The Dow Jones average of 30 industrials rose 15.68 to 1,794.30, bringing its gain over the past three sessions to 58.81 points.
Volume on the New York Stock Exchange came to 184.76 million shares, up from 156.25 million on Wednesday.
The day’s trading volume figures were swollen by a 48.79-million-share block of Navistar International that crossed the tape early in the session at 10.
Navistar shares later traded at 10 3/8, up from Wednesday’s close.
In the general market, analysts said hopes that interest rates would keep falling gave stocks a lift. In the credit markets, prices of long-term government bonds, which move in the opposite direction from interest rates, showed gains ranging to $5 for every $1,000 in face value.
Tobacco Stocks Strong
Albert Wojnilower, economist at First Boston Corp., said the general assumption that central banks would keep rates from rising “seems just as reliable at these lower levels as before.”
“Although the ride has gotten bumpier, the market bandwagon is still rolling,” Wojnilower declared in a paper prepared for a conference in San Francisco on the business outlook.
Tobacco stocks were strong for the second straight day following an appeals court’s ruling that health warnings printed on cigarette packs protect manufacturers from product liability suits. Philip Morris climbed 6 3/4 to 130 3/4 and R. J. Reynolds Industries was up 2 at 46 5/8. Philip Morris by itself accounted for a big chunk of the gain in the Dow Jones industrials.
Ford Motor, which declared a 3-for-2 stock split and an increased cash dividend, gained 2 3/4 to 83 3/8. Among the other leading auto stocks, General Motors jumped 2 1/2 to 85 3/8 and Chrysler 1 5/8 to 42 1/2.
J. P. Morgan, which reported a sharp increase in first-quarter earnings Wednesday, rose 4 3/8 to 83.
International Business Machines, which came under pressure earlier in the week as traders awaited the company’s quarterly financial report today, rebounded 1 to 150.
In the bond market, government bond prices finished with modest gains and interest rates made minor movements. Corporate and municipal issues turned in a mixed performance.
The price of the 30-year Treasury bond rose 3/16 point. Its yield edged down to 7.32% from 7.33%.
In the secondary market for U.S. Treasury securities, prices of short-term governments rose by 1/32 point to 1/8 point and intermediate maturities rose by 3/16 point to point. The 20-year bond gained 1/8 point.