Dow Extends Decline 2nd Day, Closes Off 4.91 Points

From Times Wire Services

Wall Street stocks ended slightly lower today, narrowly extending the previous day's losses in a dull session.

The Dow Jones average of 30 industrials declined 4.91 points to 2,736.77.

Declining issues outnumbered advancers by a 10 to 9 margin on the New York Stock Exchange, with 755 issues down, 700 up and 516 unchanged.

Big Board volume totaled 145.85 million shares, against 154.64 million in the previous session.

The NYSE's composite index fell 0.37 to 192.82.

At the American Stock Exchange, the market value index ended 0.95 higher at 375.83.

The market took little comfort from news that several major companies were undertaking strict cost-cutting measures. McGraw-Hill Inc. announced today that it would eliminate 1,000 jobs, and on Tuesday, International Business Machines Corp. said it would take a $2.3 billion charge as part of a program that will cut 10,000 jobs.

The corporate announcements, further evidence of a weakening economy, revived hopes that the Federal Reserve would nudge interest rates lower to avert a recession.

Many participants held to the sidelines waiting for Friday's November jobs report--the first official gauge of how the economy performed last month.

"Everyone's just sitting around waiting for numbers," said Hildegard Zagorski at Prudential-Bache Securities. "The Fed shows no sign of doing anything. The market has kind of run out of steam."

Bond prices rose slightly in extremely light trading today.

The Treasury's benchmark 30-year bond was up 1/16 point, or under $1 per $1,000 face amount, around midday. Its yield fell to 7.87% from 7.88% late Tuesday.

"We're a shade higher on virtually no volume at all," said economist Steven Wood with BankAmerica Capital Markets Group in San Francisco. "People are basically content with their positions until the end of the year."

Wood also said the Federal Reserve did not intervene in the money market this morning as it typically does, removing another possible spur to bond trading activity.

Wood said there was no market movement following a government report this morning that productivity in the non-farm sector of the economy improved at an annual rate of 2.5% in the third quarter. The report contained clear signs of further economic weakening.

In the secondary market for Treasury bonds, prices of short-term governments were unchanged to up 1/32 point, intermediate maturities were up 1/16 point to 3/32 point and long-term issues were unchanged to 3/32 point higher, according to Telerate Inc., the financial information service.

The Shearson Lehman Hutton daily Treasury bond index, which measures price movements on all outstanding Treasury issues with maturities of a year or longer, rose 0.77 to 1,196.67.

Yields on three-month Treasury bills slipped to 7.79% as the discount lost 1 basis point to 7.55%. Yields on six-month bills fell to 7.66 as the discount declined 1 basis point to 7.29%. Yields on one-year bills fell to 7.65% as the discount lost 1 basis point to 7.16%.

The federal funds rate, the interest on overnight loans between banks, was quoted at 8 7/16%.

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