Market Edges Higher; Dow Up 5 to Record
The stock market nudged ahead Wednesday, setting record highs for the third straight session.
The Dow Jones average of 30 industrial stocks, which closed above 1,900 Tuesday for the first time, gained 5.49 to 1,909.03.
Volume on the New York Stock Exchange reached 150 million shares, up from 147.67 million on Tuesday.
Analysts said the market’s rise past the 1,900 level, while certainly welcomed on Wall Street, did not create any powerful new surge of buying interest. Many market participants were awaiting the government’s report today on the employment situation for June.
The figures on such things as unemployment and the average work week were expected to set the tone for interest rates and influence the possibility of a cut in the Federal Reserve’s discount rate. If the economy remains sluggish, many economists expect the Fed to take action fairly soon to relax its credit policy.
American Can Surges
The Dow Jones industrial average would have closed about unchanged had it not been for a 5-point rise to 81 3/8 in the shares of American Can.
Enthusiasm for the stock was attributed in part to talk that the company might sell some assets and take other steps to improve its profitability.
Coca-Cola climbed 1 1/8 to 43 7/8 in active trading. On Tuesday, the company reported plans to buy JTL Corp., the nation’s biggest Coca-Cola bottler.
Tobacco stocks, which ranked No. 1 in group performance during the first half of the year as tallied by Standard & Poor’s, had another strong day. American Brands gained 5 to 98 1/2, RJR Nabisco rose 2 1/8 to 54 5/8 and Philip Morris added 1 5/8 to 76.
Among computer and technology issues, International Business Machines rose 7/8 to 149 1/2, Digital Equipment 1 to 89 1/2 and Hewlett-Packard 1 5/8 to 42.
Securities industry stocks were broadly higher, with Bear, Stearns up 2 1/2 at 31 5/8, First Boston up at 52 1/2, Paine Webber up 3/4 at 36 5/8 and Merrill Lynch up 7/8 at 35.
In the daily tally on the Big Board, about eight stocks rose in price for every seven that lost ground. Large blocks of 10,000 or more shares traded on the NYSE totaled 2,730, compared to 2,788 on Tuesday. The exchange’s composite index of all its listed common stocks gained 0.47 to 145.15.
Nationwide turnover in NYSE-listed issues, including trades in those stocks on regional exchanges and in the over-the-counter market, totaled 177.10 million shares.
Standard & Poor’s index of 400 industrials rose 0.75 to 282.24, and S&P;’s 500-stock composite index was up 0.66 at 252.70.
In the credit markets, interest rates and bond prices finished a subdued session with minor changes. Action in the credit markets continued slow because of the approaching long July 4 weekend. Bond trading will wind down at 1 p.m. EDT today.
Raymond W. Stone, chief financial economist for Merrill Lynch Capital Markets, said bond prices registered modest losses in the morning and then recovered in the afternoon. “On balance, it was a very uneventful day,” he said.
The price of the bellwether 30-year Treasury bond ended the day unchanged from Tuesday. Its yield held at 7.23%.
Analysts said bond dealers have wearied of talk of a possible cut in the discount rate. Speculation that the central bank would trim the key rate to enliven the lethargic economy has recently sparked buying in the bond market.
Although the discount rate--currently 6.5%--is the only interest rate that the Fed directly controls, adjustments in it frequently influence other credit charges. Lower interest rates would be welcomed by bond dealers because bond values are enhanced when yields decline.
A Commerce Deparment report that said orders to U.S. factories for manufactured goods declined 0.1% in May went largely ignored. The news merely provided added evidence to support a widely held belief that the economy performed poorly in the first half of the year, analysts said.
Treasury Issues Unchanged
In the secondary market for Treasury bonds, prices of short-term governments were unchanged and intermediate maturities were off by 1/32 point to 1/16 point. The 20-year bond was unchanged, according to the investment firm of Salomon Bros.
In corporate trading, industrials moved up point and utilities were up 1/8 point in moderate dealings. Among tax-exempt municipal bonds, revenue bonds pushed ahead by 3/8 point while general obligations gained point in light trading.
Yields on three-month Treasury bills crept up 1 basis point to 6.01%. Six-month bill and one-year bill yields both dropped 2 basis points, to 5.95% and 6.01%, respectively.
