Dow Drops 16 Amid Concern Over Economy

Stock prices fell Monday, depressed by profit taking, investor fears of continued sluggish economic growth and some computer program selling, analysts said.

The Dow Jones average of 30 industrials closed at 1,871.77, down 16.03 from Friday.

Losers outpaced gainers by nearly two to one. Volume totaled a light 104.35 million shares, compared to 118.13 million shares on Friday.

“Basically what we saw was a day of consolidation after the substantial gains of the last few weeks,” said Newton D. Zinder, an analyst with E. F. Hutton.

From Aug. 1 through Friday, the closely watched Dow industrial index rose 124.16 points, rebounding from the period of correction in July.

But as Monday’s session began, the market was pushed down quickly by pre-programmed computer selling, in which professional traders, operating with large amounts of money, engaged in a strategy involving stock index futures and individual stocks, analysts said.

IBM Higher

The Dow Jones average fell by as much as 17 points, then rose a bit to hover about 13 points below Friday’s close for most of the rest of the day.

International Business Machines was among the day’s winners, closing up 1 to 139. Burroughs rose 5/8 to 73, while Honeywell fell 1/2 to 71 3/8.

ICN Pharmaceuticals fell 6 to 21 3/4 and was among day’s most active issues on the New York Stock Exchange. The stock fell after reports questioned an earlier analysis based on a drug that ICN is testing on patients with acquired immune deficiency syndrome.

Among other drug companies, Eli Lilly was down 3 at 77, Upjohn fell 2 1/2 to 87 and SmithKline Beckman dropped 1 7/8 to 90.

In the credit markets, bond prices turned higher and short-term interest rates fell after a late-session rally that highlighted an otherwise lackluster trading day.

In the secondary market, the bellwether 30-year bond was up 17/32 point to yield 7.23%, down from 7.27%. The 20-year bond was up 3/4 point.