Higher Rates on Bonds Leave Investors Wary; Dow Posts Loss of 8.89
Interest rate worries helped push stock prices lower Wednesday in an erratic session.
The Dow Jones index of 30 industrials, up about 7 in early trading and down nearly 20 at its mid-session low, finished with a loss of 8.89 to close at 2,121.98.
Declining issues outnumbered advances by about 3 to 2 in nationwide trading of New York Stock Exchange-listed stocks, with 591 up, 892 down and 499 unchanged.
Big Board volume totaled 159.59 million shares, against 152.37 million Tuesday. Nationwide consolidated volume in NYSE-listed issues, including trades in those stocks on regional exchanges and in the over-the-counter market, totaled 191.22 million shares.
Analysts said traders were still expecting a continuing rally by the dollar in foreign exchange. A steady to stronger dollar would presumably attract money from overseas investors to both stocks and bonds traded in the United States.
The stock market brushed off an inflation-dampening plunge in commodity futures.
“One would have expected that, with the Commodity Research (Bureau) index down so sharply, the equities would have done better,” said Alan Ackerman, senior vice president at Gruntal & Co.
The CRB index, which is viewed as a gauge of future inflation, fell more than 6 points to 260.71 after Tuesday night’s rainfall in the Midwest.
Investors Reluctant
However, the bond market turned in an uninspired showing, leaving interest rates slightly higher on the day.
Brokers said many investors were reluctant to chase after stocks at levels near the high point of the range in which they have fluctuated since the crash last fall.
Stocks showed little effect either way from the Commerce Department’s report that the index of leading economic indicators slipped 0.1% in May.
Losers among the blue chips included Exxon, down 1/2 at 45 3/4; Ford Motor, down 3/4 at 52 5/8; General Electric, down 3/8 at 43; Du Pont, down 1/2 at 90 1/8, and Philip Morris, down 3/8 at 83 5/8.
Pullman Co. jumped 1 3/4 to 7 7/8 in active trading. The company said top executives were considering a proposal to acquire the company for $7.50 a share.
McGraw-Hill climbed 3 5/8 to 61 5/8. The company said it would reorganize into three operating companies embracing its publishing, financial services and information services businesses.
Quaker State Bid Dropped
Del Webb Corp. rose 1 1/8 to 15. The company said it knew of no corporate news to account for the advance and added that it appeared some party was accumulating its shares.
Quaker State Corp. fell 2 1/2 to 21 3/8. A group led by a New York investment banking firm said it was withdrawing its proposal to acquire Quaker State for $26.50 a share.
Large blocks of 10,000 or more shares traded on the NYSE totaled 3,125, compared to 2,987 Tuesday.
The NYSE’s composite index of all its listed common stocks dropped 0.64 to 153.13.
The Wilshire index of 5,000 equities closed at 2,705.970, down 10.856, or 0.40%, from Tuesday.
Standard & Poor’s industrial index fell 1.37 to 313.20; its 500-stock composite index was down 1.33 at 270.98.
The NASDAQ composite index for the over-the-counter market dipped 0.01 to 391.66. The American Stock Exchange index closed at 307.15, down 1.27.
In Tokyo, stocks surged to close mixed in heavy trading. The Nikkei index of 225 selected issues, which fell 36.92 Tuesday, rose 209.24 to close at 27,607.33.
In London, share prices closed lower Wednesday on the London Stock Exchange. The Financial Times-Stock Exchange 100-share index slipped 1.8, or 0.1%, to close at 1,855.1, the session’s low.
Volume on the London market was a slim 378.0 million shares, down from 386.7 million shares traded Tuesday.
