Late Blue-Chip Buying Pushes Dow Up 8.18
The stock market turned in a mixed performance in dull trading Monday as some late blue-chip buying boosted the Dow Jones industrial average.
Various market measures made minor movements during the session. After spending most of the day near Friday’s closing level, the Dow Jones average of 30 industrials staged a late advance and finished with a gain of 8.18 at 1,843.75.
Among issues included in Wall Street’s best-known indicator, buyers were attracted to Merck, which rose 2 1/2 to 178 7/8; General Electric, up 2 3/4 to 82 1/2, and Minnesota Mining & Manufacturing, up 2 to 106.
International Business Machines moved ahead 1 7/8 to 161 3/8, a 52-week high. The advance came despite continuing caution on the computer giant’s outlook voiced by IBM President and Chief Executive John F. Akers.
Akers told an annual gathering of stockholders that IBM expects “a demanding year ahead, to make ourselves a company as lean and vigorous as possible and thus ready ourselves to take on our competitors, who, when the turnaround comes, will emerge tougher and more challenging than ever.”
Volume Slows
Trading volume on the Big Board slowed to 123.86 million shares from Friday, when 142.31 million shares changed hands.
Losers held a slim lead over gainers in the overall tally of stocks listed on the New York Stock Exchange.
Large blocks of 10,000 or more shares traded on the NYSE totaled 2,009, down from Friday’s 2,564.
Analysts said the market seemed a bit weary from its earlier climb this year, with many investors content to collect profits made on selected stocks.
Investors had some uneasiness ahead of the Treasury’s announcement Wednesday of its quarterly borrowing plans. The auctions that will be held next week are expected to total a record amount of notes and bonds, a reminder of the bloated federal budget deficit.
Ford was the volume leader, posting a decline of 5/8 to 79. Other heavily traded losing stocks included Sanders, down 1 to 33 1/2, and American Express, off 2 1/8 to 60 5/8.
Several tobacco stocks were among the volume leaders. Market watchers attributed the weakness to a ruling by a U.S. District Court in Boston on Friday that health warnings on cigarette packages do not shield manufacturers from liability lawsuits. The decision ran counter to one by a federal appeals court in Philadelphia, which found that the warnings were adequate.
FMC Gains
RJR Nabisco fell 3/8 to 44 7/8 and Philip Morris lost 1 3/8 to 63 1/2.
FMC spurted 3 to 99. The company said its board approved a plan to raise the cash portion of its recapitalization program by $10 a share to $80. Shareholders, who will vote on the amended plan at a meeting scheduled for May 22, would receive $80 and one new share of the recapitalized firm.
Meanwhile, American Brands jumped 4 to 91 1/2 amid speculation that the company is a takeover candidate.
Nationwide turnover in NYSE-listed issues, including trades in those stocks on regional exchanges and in the over-the-counter market, totaled 147.50 million shares.
Standard & Poor’s index of 400 industrials rose 1.10 to 271.07, and S&P;’s 500-stock composite index was up 0.79 at 243.08.
Bond Prices Advance
In the bond market, prices advanced, continuing their rebound from last week’s sharp pullback.
Despite another day of declines by the dollar against major foreign currencies--a factor in last week’s bond market slump--analysts said low oil prices and economic sluggishness continued to support bond prices and depress interest rates.
The 30-year Treasury bond rose 1 1/16 points, or just over $10 for each $1,000 in face value, to yield 7.50%, down from 7.57% late Friday. For all of last week, the bellwether bond fell about $65 for each $1,000 in face amount.
