Market’s Advance Halted as Dollar, Bonds Weaken

The stock market declined in active trading Tuesday, snapping a steady 11-day advance as the support it had drawn from the stronger dollar and bond markets began to fall away.

The Dow Jones average of 30 industrials fell 5.78 to 2,439.73.

Declining issues outpaced advancers by about 3 to 2 on the New York Stock Exchange.

Big Board volume totaled 194.20 million shares, up from 178.21 million traded Monday.

The market started out by posting a strong gain supported, as in recent sessions, by a stronger dollar, higher bond prices and growing foreign demand. The Dow Jones barometer was up 10.17 points by 11 a.m. EDT, to 2,455.68.

But stock prices began to sag around midday, as the dollar dropped and bond prices fell.

The bond market’s bellwether 30-year Treasury bond fell 6/32 point, or about $2 for every $1,000 in face value, as its yield edged up to 8.42% from 8.40% Monday.

Nationwide turnover in NYSE-listed issues, including trades in those stocks on regional exchanges and in the over-the-counter market, totaled 226.40 million shares.

The NYSE’s composite index was down 0.55 at 173.22.

Standard & Poor’s index of 400 industrials fell 1.20 to 357.94, and S&P;’s 500-stock composite index was off 1.22 at 308.43. The Wilshire index of 5,000 equities closed at 3,041.197, down 8.832.

The American Stock Exchange market-value index fell 0.86 to 338.19. The NASDAQ composite index closed at 427.98, down 1.27.

In corporate trading, industrials were unchanged and utilities fell 1/8 point in light activity, according to Salomon Bros.

The federal funds rate, the interest on overnight loans between banks, traded at 6.188%, down from 6.875% Monday.