Last-Minute Trading Pushes Stocks Higher; Dow Rises 3.75 to 2,166

A spurt of late buying in the blue chip sector helped Wall Street stocks to a modestly higher finish in light trading Wednesday. The Dow Jones index of 30 industrials edged up 3.75 to 2,166.43.

With two sessions left before New Year’s, the Dow Jones index sports a gain of 227.60 points, or 11.74%, since last Jan. 1. That ranks as a slightly above-average showing by the historical standard of 9% to 10% annual gains for stocks.

Advancing issues outnumbered declines by about 4 to 3 in New York Stock Exchange trading. Big Board volume rose to 110.63 million shares against Tuesday’s 87.49 million.

Although volume picked up from the previous two days, when the NYSE had its second- and third-slowest sessions of the year, trading remained lethargic with many participants away on holiday and little fresh news to attract interest.

“This is what I call a four-cups-of-coffee day,” said technical analyst Alfred Goldman at A. G. Edwards & Sons. “It’s still very uninspiring--a lot of the institutions have declared the year over.”

For much of the day weak bond prices kept a lid on stocks, which traded in a tight range.

“The buying came in when the stock market ignored the weakness in the bond market,” said Jon Groveman, head trader at Ladenburg, Thalmann & Co. “This is seasonally a very strong time, so it (the rise) is not unusual.”

But despite the late gain, traders said the breadth in the general market remained poor. “It’s not a rally that makes one feel good about the market,” said Ed Laux, a trader with Kidder, Peabody & Co.

In addition, volume was pumped up by a several dividend-related trades, particularly among telephone companies and utilities.

Goldman said much of the other activity revolved around “those stocks involved in mergers, real and imagined.” The trend of higher interest rates, he said, “is making stocks look overvalued relative to money market investments.”

Quantum Chemical Corp. shares soared 17 1/4 to 105 3/4 after the company announced a special cash dividend of $50 a share.

Pennwalt Dips

Other chemical stocks rose in sympathy with Quantum. Among the gainers were Dow Chemical Co., ahead 2 to 86 1/2; Aristech Chemical Corp., up 1 1/4 to 28 1/4; Vista Chemical Co., up 2 3/8 to 49, and Georgia Gulf Corp., ahead 4 1/4 to 75 5/8.

Shares of Pennwalt Corp. fell 5/8 to 104 as analysts said prospects grew for a lengthy takeover battle with suitor Centaur Partners, a New York-based investment partnership. The Philadelphia-based diversified chemicals company Tuesday rejected as “completely unacceptable” a $100-a-share, or $765 million, takeover offer from Centaur.

Telephone company shares were actively traded on dividend-related plays, traders said. Pacific Telesis Group fell 1/4 to 30 1/2, while American Telephone & Telegraph was unchanged at 28 7/8 in heavy trading.

Dallas Corp. posted the day’s biggest percentage advance among NYSE stocks, up 3 3/8 at 16 1/2. The company declined to comment on the activity.

Athlone Industries climbed 3 1/4 to 33. The company reported plans to transfer the assets of its Jessop Steel subsidiary to a new limited partnership.

American Brands fell 2 3/4 to 66 3/4. The stock climbed 12 points Monday and Tuesday on takeover rumors and speculation.

London Stocks Gain

There were signs of buying by traders hoping for a bounce in depressed lower-priced issues once the pressure of year-end tax selling is lifted off the market at the end of this week.

For example, Reebok International gained 1/2 to 11 1/8; Cooper Cos. up 3/8 to 5 1/2, and Floating Point Systems edged up 1/4 to 2 3/4.

In the blue chip sector, McDonald’s rose 1/4 to 47 3/8; International Paper was up 1/4 to 45 1/8; American Express advanced 1/8 to 26 7/8, and Exxon rose 1/8 to 45 1/8.

The NYSE’s composite index of all its listed common stocks gained 0.23 to 155.81.

Standard & Poor’s industrial index rose 0.31 to 320.49, and S&P;’s 500-stock composite index was up 0.25 at 277.08.

The Wilshire index of 5,000 equities closed at 2,727.276, up 3.982 from Tuesday’s close.

The NASDAQ composite index for the over-the-counter market added 0.12 to 376.76. At the American Stock Exchange, the market-value index closed at 302.14, up 0.70.

In London, stocks finished higher in what dealers called a reflection of year-end optimism. The dollar’s relative strength also provided some support, prompting rises among British stocks with substantial U.S. earnings, dealers said.

The Financial Times 100-share index finished up 13.7 points to 1,787.6.