The stock market bumped about erratically Wednesday, hitching an early ride on a bond market rally but closing mixed by the end of the day.
The Dow Jones index of 30 industrial stocks, up more than 16 points at noon, settled at 1,911.14, down 9.45.
But gaining issues outnumbered decliners by about 8 to 7 on the New York Stock Exchange.
Big Board volume totaled 176.36 million shares, compared to 138.38 million shares Tuesday.
The market took heart early when the Commerce Department said U.S. gross national product rose at an annual rate of 4.2% in the fourth quarter. The figure was higher than expected and calmed fears that the October stock market debacle--which occurred in the fourth quarter--had caused a slowing of the economy.
But the early rally ran out of steam as investors shifted their focus to the fact that much of the GNP rise was due to a build-up in inventories, suggesting that current first-quarter growth may not be robust.
Strong Bond Market
The only reason that concerns about the first quarter did not have an early negative impact on stock prices was because the bond market was so strong, traders said.
"The market seems to be looking for some sense of direction, and hasn't found the element or elements that are reasonable to focus on," said Eugene Peroni, an analyst at the Philadelphia securities firm of Janney Montgomery Scott Inc.
In addition, a squall of program selling upset the rally, sending many stocks sharply lower.
In program trading, professionals use computers to profit on differences between stock index futures and their underlying baskets of stocks.
At the close, the market had recovered only part of its losses.
Hildegarde Zagorski, an analyst at Prudential-Bache Securities Inc., said the market's real problem was that "it has no point of view."
"It jumps on every statistic, and swings from every branch that happens to be there," she said.
The market "had time to establish a focal point," Peroni said. "It was bolstered by the bond market, but it didn't hold--demonstrating that the psychology is very brittle."
American Standard led the Big Board's most-active list, closing up 20 7/8 at 58 7/8. The stock is the target of a $56-a-share offer announced Wednesday by Black & Decker, which closed at 19 1/2, down 7/8.
Among other takeover-related issues, Eastman Kodak, which slumped after the company offered $89.50 per share for Sterling Drug last week, was down 5/8 at 42 3/4.
And Federated Department Stores closed down 5/8 at 50. On Monday, Canadian developer Campeau Corp. bid $4.2 billion for the company.
IBM was up 7/8 at 112 3/4.
Santa Fe Southern Pacific, which declared a special $30-per-share dividend Tuesday, closed up 1 at 47 1/2.
Monsanto was up 4 3/4, at 83 1/2, after its NutraSweet Co. subsidiary announced what it called the first completely natural fat substitute.
Procter & Gamble, which has developed another fat substitute, declined 1/2 to 84, after an analyst said Food and Drug Administration approval is a year away.
Nationwide turnover in NYSE-listed issues, including trades in those stocks on regional exchanges and in the over-the-counter market, totaled 207.19 million shares.
The NYSE index was down 0.03 at 140.23.
Standard & Poor's index of 400 industrials fell 0.56 to 285.36, and S&P;'s 500-stock composite index was down 0.19 at 249.38.
At the American Stock Exchange, the market-value index fell 0.16 to 265.61. The NASDAQ composite index for the OTC market closed at 339.80, up 0.58.
London Stocks Lower
The Wilshire index of 5,000 equities, which reflects the market value of 5,000 NYSE, American and OTC issues, stood at $2.455.8 trillion, up $1.12 billion, or 0.05%, from Tuesday.
In foreign markets, prices on the London Stock Exchange fell slightly in light trading Wednesday as participants awaited release of British balance of payments data for December.
The Financial Times 100-share index of issues listed on the London Stock Exchange finished down 2.1 points at 1,765.2.
The index moved down as much as 9.2 points around midday but later recovered somewhat on the back of a firmer early performance on Wall Street.
Stock prices slumped in Tokyo Wednesday on profit taking after four consecutive sessions of higher prices, brokers said.
The Nikkei 225-share average fell 162.85 points, or 0.69%, to close at 23,335.91.