STOCKS : Real Estate Market Still Weak; Dow Down 1.92

Stock prices continued to sag Tuesday after a seesaw day of trading marked by concerns about the weak real estate market and its impact on financial institutions.

The Dow Jones index of 30 industrials slipped 1.92 to 2,695.61, extending its loss over the past four sessions to 65.48 points.

At one point Tuesday morning, the Dow was down about 30 points, extending a drop of 42.02 points Monday.

Declining issues outnumbered advances by about 2 to 1 in nationwide trading of New York Stock Exchange-listed stocks, with 513 up, 1,021 down and 479 unchanged.

But the market settled down after White House spokesman Marlin Fitzwater declared that “inflation remains under control,” and that interest rates could go lower. That raised hopes that the Federal Reserve will push down interest rates.

Fitzwater’s statement came after the Labor Department reported that consumer prices advanced 0.4% in November, following a 0.5% increase in October.

But traders said they were much more concerned with the key Federal Reserve Open Market Committee, the Fed’s policy-making committee, which met Monday and Tuesday. The committee gave no immediate indication that credit would be eased any time soon.

“The Fed did nothing today,” said Tom Walsh, a head trader at Nikko Securities Co. “That was the reason the Dow was down 30 earlier.”

A few recently depressed mortgage and regional banking stocks rebounded. Federal National Mortgage rose 1 3/8 to 32 1/2, and Bank of New England gained 1/2 to 8.

Money-center bank stocks were mixed. Citicorp rose 1/8 to 27, Chase Manhattan added 1/4 to 32 1/8, J. P. Morgan lost 3/8 to 40 1/4, and BankAmerica was up 5/8 at 24 1/2.

Campbell Soup’s stock soared 3 1/4 to 53 on renewed takeover speculation after the family-run food company dissolved a trust holding 26.5% of its voting shares.

The battered technology sector also attracted “bargain-hunting” buyers. International Business Machines gained 1 1/8 to 94 3/4, Digital Equipment added 2 1/8 to 84 3/8, Hewlett-Packard rose 1 to 45 1/2, and Unisys edged up 1/4 to 14 1/8.

Unisys said it expected to post a “significant” profit in 1990, in large measure because of cost-cutting steps taken this year.

Big Board volume came to 186.06 million shares, against Monday’s 184.79 million.

Market overheating jitters and concerns about a possible discount rate rise kicked Tokyo stocks down sharply early Tuesday, but they regained about half their losses at the close in relatively active trading. The 225-share Nikkei index lost 147.08 points after surging 315.14 points to a record close Monday.

In London, stocks ended lower in drab trading as dealers reacted to a weak tone on Wall Street. The Financial Times 100-share index ended down 16.4, closing at 2,342.1.

CREDIT

Bond Prices Mixed as Fed Stays Mum

Bond prices were mixed and Treasury bill yields rose as the Federal Reserve Board gave no indication whether it would relax credit policy amid signs of a slowing economy.

The Treasury’s benchmark 30-year bond gained 1/32 point, or about 30 cents for every $1,000 in face amount. Its yield was unchanged from late Monday at 7.83%.

Volume was extremely light as customers appeared content to carry their portfolios into the end of 1989, traders said.

Steven A. Wood, economist with BankAmerica Capital Markets Inc. in San Francisco, said the Treasury bills slumped when the Federal Open Market Committee gave no hints of its interest rate plans.

The panel of Federal Reserve Board members and regional bank presidents that maps out monetary strategy met for a second day in Washington. Although the meeting is held in private, there was speculation about what the group might do.

Traders are watching for possible changes in the Federal Reserve’s credit policies in light of recent reports showing a slowing in economic growth that could lead to a lowering of interest rates.

The federal funds rate, the interest on overnight loans between banks, was quoted at 8.438%, down from 8.50% late Monday.

COMMODITIES

Orange Juice Futures Rise on Frost Fears

Forecasts for a frosty weekend in Florida’s citrus belt drove orange juice futures prices up sharply, while harsh winter weather in the North spurred the heating oil market to greater gains.

On other commodity markets Tuesday, grains and soybeans, livestock and meat, and precious-metals futures were mixed.

Frozen concentrated orange juice futures settled 5 to 5.4 cents higher on the New York Cotton Exchange, with the contract for delivery in January at $1.3245 a pound. Orange juice futures normally are limited to daily moves of 5 cents but the limit on the January contract has been lifted pending the contract’s upcoming expiration.

Heating oil for near-term delivery rose on the New York Mercantile Exchange for the third straight day and the 14th time in the last 15 sessions, still supported by strong, weather-driven demand for increasingly tight supplies.

Crude oil futures finished mixed after a day of erratic price swings linked to the expiration of the January contract, which went off the board 11 cents higher at $22.33 a barrel. Gasoline and deferred deliveries of heating oil finished lower.

CURRENCY

Dollar Inches Up in Quiet Trading

The dollar finished slightly higher against most major currencies but slipped against the Japanese yen in quiet global foreign exchange dealings.

Currency analysts said the pace of trading has slowed in recent days as the year-end holidays approach and traders try to protect whatever gains they may have made for the year.

The dollar’s decline against the yen was attributed to speculation that the Bank of Japan may soon raise its key lending rate. Japanese authorities denied the rumors of an imminent rate hike, but speculation persisted that an increase would eventually be necessary to shore up the yen.

In Tokyo, the dollar fell 0.42 Japanese yen to close at 143.80 yen. Later, in London, the dollar was quoted at 143.80 yen. The dollar fell to 143.65 yen in New York from 143.725 yen late Monday.

The dollar gained against the British pound. In London, the pound fell to $1.6005 from $1.6020 late Monday. In New York, the pound fell to $1.6010 from $1.60685.

Gold prices were narrowly mixed. Republic National Bank of New York quoted a bid for gold as of 4 p.m. EST of $411.75 an ounce, down $1 from Monday’s late bid.

On New York’s Commodity Exchange, gold for current delivery edged up 10 cents an ounce to $411.90.