Traders Ignore Dollar Drop, Bond Slump and Oil Price Rise : Dow Up 9.46 in Late Buying Spree

A late buying spree pulled Wall Street stocks to a new post-crash high Wednesday despite the triple onslaught of a lower dollar, weak bond prices and higher oil prices.

The Dow Jones index of 30 industrials, which had climbed 38.04 points on Tuesday, rose another 9.46 to 2,265.89.

With four sessions to go in January, the index sports a gain of better than 97 points since the start of the year.

Advancing issues outnumbered declines by about 5 to 4 in New York Stock Exchange trading.

Big Board volume dipped to 183.61 million shares from Tuesday’s 189.62 million.

Many market analysts had expected a day of consolidation after the Dow index jumped 38 points Tuesday, closing above 2,246.74, the level it was at before the 508-point fall of Oct. 19, 1987.

Dollar Dips

But market analysts said that when equities slipped in mid-afternoon trading Wednesday, investors afraid of being left out of a rally that has lifted the Dow index nearly 100 points since the beginning of the year came into the market to buy.

“People feel there is still enough near-term potential in the market to use intra-day price drops as a window of opportunity,” said technical market analyst Eugene Peroni of Janney Montgomery Scott.

“The bond market was down, a clear reversal of near-term trends, and the dollar was down again. There is some reason to believe we do not have all the ingredients in place for a strong market,” said analyst Charles Jensen of MKI Securities.

The dollar closed slightly lower at 1.8395 West German marks and 127.30 Japanese yen, down from 1.8415 marks and 127.65 yen at Tuesday’s close. The benchmark 30-year Treasury bond also fell, dropping 12/32 to 101 28/32, boosting its yield to 8.82% from 8.78% at Tuesday’s close.

Nevertheless, the concern among investors that they will miss the boat prompted many to buy shares when prices dropped in seesaw trading Wednesday afternoon.

Skepticism Lingers

Some analysts viewed the market’s increased volatility--its tendency to quickly swing up or down--as a sign that its upward movement may slow.

“The volume is expanding, and the market is getting more volatile within a relatively narrow range. This usually suggests a tendency toward profit taking and a slowing of momentum,” Peroni said. He said that in the next few weeks the Dow index could touch the 2,300 level, but he said that after that, shares could retreat.

“The market may be setting up for a pullback,” Jensen said.

The market also has been helped by a rising dollar in foreign exchange and falling interest rates in the long-term bond market.

With all that, however, brokers said there remained many skeptics, expecting a slowing economy, who were unwilling to chase after stocks at their current levels.

If the day had a theme, it was upbeat earnings reports, sometimes accompanied by dividend increases.

For example, Du Pont rose 2 1/8 to 98 1/2 on word from the company of higher 1988 earnings, a dividend increase and plans for a buyback of as many as 20 million shares, or about 8% of the total outstanding.

Cray Research Drops

Phelps Dodge gained 2 3/4 to 60 5/8, trading at new 52-week highs. The company posted sharply higher earnings for the fourth quarter and raised its quarterly dividend from 40 to 60 cents a share.

Upbeat earnings reports bolstered such stocks as Walt Disney, up 1/2 at 72, and SmithKline Beckman, up 1 3/8 at 52.

On the down side, Amre suffered the day’s biggest percentage loss, tumbling 3 1/2 to 6 7/8. The company said it may post a loss of about $2 million for its current fiscal quarter, which ends next week.

Cray Research, which spoke of significantly lower results for the first quarter, fell 4 1/4 to 60 1/4.

The Wilshire index of 5,000 equities closed up 6.069 at 2,843.979.

The NYSE’s composite index of all its listed common stocks gained 0.34 to 162.33.

Standard & Poor’s industrial index rose 0.73 to 333.99, and S&P;’s 500-stock composite index was up 0.65 at 289.14.

The NASDAQ composite index for the over-the-counter market added 2.04 to 394.03. The American Stock Exchange market-value index closed at 319.50, up 0.76.

In foreign trading, Japanese stocks firmed to a new record close Wednesday after last-minute futures-related buying brought prices back up from afternoon losses. The Nikkei 225-share index edged up 10.11 points to close at 31,567.79.

In London, share prices finished narrowly mixed, as traders took advantage of the market’s recent surge to take some profits ahead of Friday’s scheduled release of British trade figures. The Financial Times-Stock 100-share index closed down 2.1 points at 1,939.