Dow Rides a See-Saw Market, Ends Up 29.97

A late buying wave buoyed blue chip stocks, carrying the Dow Jones industrial average back above the 2,600-mark as the market moved ahead 29.97 points today to 2,613.05.

The New York Stock Exchange composite index rose 2.04 to 188.14, an all-time record closing high, surpassing the previous closing high of 187.99 set on Aug. 25, 1987.

NYSE volume was 188,27 million shares, compared with 179,27 million shares Tuesday.

The average share price rose 40 cents as advances led declines 969 to 478.

The market rode a see-saw during the session with the Dow industrials reversing course several times while, in the broader market, advancing and declining issues on the New York Stock Exchange exchanged the lead a few times.

For much of the day, traders unloaded International Business Machines and other technology stocks in the wake of a bearish forecast for the personal computer market. But the sell-off helped lure bargain hunters off the sidelines and IBM, for one stock, ended the day having recouped most of its earlier loss.

Confusion about just how well the economy is doing has made the market nervous about corporate profit prospects. A significant slowdown, combined with continuing strength in the dollar, could make things difficult for many companies.

Thomas Czech, chairman of the investment committee at Blunt Ellis & Loewi, said stocks might have gotten a lift from a decline in the dollar’s value against other major currencies today.

“Maybe we lifted some recession fears today with the dollar coming off as it did,” said Czech. “The dollar is indicating maybe we’ll get export business moving in the right direction again.”

The market also is hoping a clearer picture about the economy will emerge from Thursday’s report on the Gross National Product for the second quarter.

Bond prices edged higher for the third consecutive session in early dealings today as traders looked for more evidence of possible credit loosening by the Federal Reserve.

The Treasury’s benchmark 30-year bond was up 7/32 point, or about $2 for every $1,000 in face value, at midday, matching Tuesday’s rise.

Its yield, which moves in the opposite direction from price, fell to 8.09% from 8.11% late Tuesday.

Analysts said there was no specific economic news driving the market this morning, but noted that the Federal Reserve has been inactive in recent days while the federal funds rate has been trading below its recent range of about 9 1/4% to 9 3/8%.

The federal funds rate is the interest banks charge each other for short-term loans. The central bank can influence the rate by buying or selling government securities, thereby either adding or draining reserves from the monetary system in its bid to keep the economy growing with low inflation.

The federal funds rate was trading at 9 1/16% at midday, unchanged from late Tuesday.

While some analysts pointed to the low funds rate as evidence of a more relaxed policy, others said it is too early to say whether the Fed has taken that step.

In the secondary market for Treasury bonds, prices of short-term governments were up 1/32 point, intermediate maturities were up 1/8 point and long-term issues rose as much as 7/32 point, according to Telerate Inc., the 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.

The Shearson Lehman Hutton daily Treasury bond index, which measures price movements on all outstanding Treasury issues with maturities of a year or longer, was up 0.97 at 1,190.61.

In corporate trading, industrials were up. 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, rose 0.25 to 330.56.

Yields on three-month Treasury bills edged up to 8.27% as the discount rose 1 basis point to 8.00%.