Dow Soars 25.42; Job Report Fuels Optimism

From Associated Press

The stock market jumped ahead today, posting its fourth straight gain amid increasing hopes for further declines in interest rates.

The Dow Jones average of 30 industrials climbed 25.42 points to 2,487.86, stretching its gain for the week to 47.80 points.

Advancing issues outnumbered declines by more than 2 to 1 on the New York Stock Exchange.

Big Board volume totaled 166.43 million shares, up from 140.45 million in the previous session.


The NYSE’s composite index rose 1.74 to 181.56.

The market opened on a hesitant note, but then picked up steam at midsession as traders concluded that the Federal Reserve apparently had been encouraged to relax its credit policy by the Labor Department’s employment data for June.

The report showed an increase of 180,000 in nonfarm payroll employment, below most advance estimates.

Bond Prices Rise


The figures for May were revised to show a gain of 207,000, more than double the 101,000 originally reported a month ago. Still, brokers said, Wall Streeters came increasingly to believe that the Fed interpreted the data as reason enough to ease up on its credit restraints.

Bond prices were higher in early trading today, nudged upward by the new unemployment statistics that indicated the economy is slowing.

The Treasury’s closely watched 30-year bond was up about 5/16 point, or $3.12 for every $1,000 in face value, at around midday. Its yield, which moves inversely to price, had declined to 8.06% from 8.09% late Thursday.

Signs of slowing economic growth ease fears of inflation, an enemy of the bond market. They also increase the chances that the Federal Reserve could loosen monetary policy and push interest rates lower.


In the secondary market for Treasury securities, prices of short-term government issues had risen 3/16 point to 9/32 point, intermediate maturities had gained 1/4 point to 5/16 point, and 20-year issues had jumped 11/16 point, according to Telerate Inc., a financial information service.

The movement of a point is equivalent to a change of $10 in the price of a bond with a $1,000 face value.

In corporate trading, industrials slipped. Moody’s investment grade corporate bond index, which measures total return on a portfolio of 80 corporate bonds with maturities of five years or longer, edged down 0.02 to 327.77.

Yields on three-month Treasury bills fell to 7.93% as the discount dropped 11 basis points to 7.68%. Yields on six-month bills declined to 7.85% as the discount tumbled 8 basis points to 7.46%. Yields on 1-year bills fell to 7.82% as the discount slid 11 basis points to 7.30%.


A basis point is one-hundredth of a percentage point. The yield is the annualized return on an investment in a Treasury bill. The discount is the percentage that bills are selling below the face value, which is paid at maturity.

The federal funds rate, the interest on overnight loans between banks, was quoted at 9 1/4%, down from 9 5/16% late Thursday.