STOCKS : Dow Rises 7.88 to 2,695.72 in Quiet Trading
The stock market eased back Thursday after breaching the 2,700 level on the Dow index but still managed to chalk up a moderate gain in light trading ahead of several important government economic reports due today.
Wall Street was also awaiting today’s “triple witching hour.”
The Dow Jones index of 30 industrials, up about 18 points at its mid-session peak, closed with a 7.88 gain at 2,695.72.
In the broader market, advancing issues slightly outnumbered declines in nationwide trading of New York Stock Exchange-listed stocks, with 749 up, 690 down and 511 unchanged.
Business was sluggish on the NYSE, where 144.4 million shares changed hands, compared to 145.1 million Wednesday.
Some analysts were encouraged that stock prices moved up and briefly passed the key 2,700 level on the Dow earlier in the day. The index last closed above 2,700 on Jan. 11.
MCA, which skidded 1 7/8 Wednesday in the wake of its agreement to acquire Geffen Records for stock valued at about $545 million, dropped another 2 1/8 to 52 3/8. Several analysts have expressed concern that the deal may dilute MCA’s per-share earnings. Time Warner also fell 1 3/4 to 96 1/4; its record distribution contract with Geffen expires Dec. 31.
Glaxo Holdings, which posted a 27% increase in pretax profit for the six months through Dec. 31, gained 1 1/8 to 25 1/8.
Mortgage & Realty Trust plunged 6 1/2 to 6 1/4, recording by far the day’s biggest percentage loss. The trust said it didn’t make a payment that was due Tuesday on certain maturing debts and added that it was talking with lenders in an effort to obtain funds for its short-term needs.
Prices on the Tokyo Stock Exchange rebounded sharply on buying by investment trusts of domestic demand-related issues, but most investors stayed on the sidelines, concerned over the yen and an expected hike in interest rates. In Tokyo, shares closed higher after falling for three consecutive sessions. The 225-share Nikkei index climbed 319.51 points to close at 32,671.64.
In London, share prices ended higher after a quiet session. The Financial Times 100-share index rose 8.8 points to end the day at 2,234.9.
CREDIT Bond Prices Finish Day Slightly Lower
In the credit markets, bond prices ended slightly lower after a choppy trading day.
The Treasury’s closely watched 30-year bond slipped about 1/8 point, or $1.25 for every $1,000 in face value. Its yield, which rises when the price declines, edged up to 8.61% from 8.60% late Wednesday.
Analysts said bond prices started losing ground early in the day in anticipation of today’s key economic reports.
The federal funds rate, the interest rate banks charge each other on overnight loans, was quoted at 8.25%, up from 8.188% late Wednesday.
CURRENCY Dollar Hits High Against Yen, Slips
The dollar hit its highest level against the Japanese yen in nearly three years but fell back on profit-taking and rumors that the Bank of Japan would raise a key interest rate.
The dollar declined against most major foreign currencies in selling sparked by speculation about lower U.S. interest rates.
Currency dealers said a comment by President Bush suggesting that he would welcome a drop in interest rates sapped bullish sentiment toward the dollar out of the foreign exchange market.
A rumor that Japan might raise its discount rate by 1 1/2 percentage points also had a negative impact on the dollar. Higher Japanese rates would enhance returns on yen-denominated investments and tend to bolster demand for yen.
The dollar also was under pressure from profit taking ahead of U.S. economic reports due Friday on wholesale inflation, industrial production and housing starts.
The dollar closed in New York at 1.6990 West German marks, down from 1.7110 late Wednesday.
In Tokyo, the dollar closed at 152.47 Japanese yen, up from 152.20 yen. In London late Thursday, the dollar closed at 152.55 yen. In New York, the dollar bought 152.285 yen, up from 152.18 yen late Wednesday.
In London, the British pound regained some recent lost ground against the dollar. It closed at $1.6177 in London, up from $1.6090 late Wednesday. Later, in New York, a pound fetched $1.6215 compared to $1.6103 on Wednesday.
Gold prices edged higher in New York after falling overseas.
Republic National Bank of New York quoted an ounce of gold at $398.20 as of 4 p.m. EST, up 20 cents from Wednesday’s late bid. On New York’s Commodity Exchange, gold for current delivery settled at $398.10 an ounce, up 10 cents.
COMMODITIES Soybean, Sugar Rise on Brazil Worries
Soybean and sugar futures prices rose sharply, partly reflecting fears that Brazil’s new president will seek higher taxes and restrictions on exports of some of the country’s major commodities.
On other commodity markets, grain and petroleum futures advanced; copper surged; precious metals were mixed; cattle futures retreated, and pork futures were mixed.
Soybean futures settled 9 to 13.5 cents higher on the Chicago Board of Trade, with the contract for delivery in March at $5.86 a bushel.
Sugar futures made new 8 1/2-year highs on New York’s Coffee, Sugar & Cocoa Exchange on rumors that Brazil may eliminate or reduce exports to divert more sugar to the country’s fuel alcohol program.
Sugar futures settled 0.23 to 0.39 cent higher, with May at 15.93 cents a pound after trading as high as 16.02 cents during the session for the first time since mid-1981.
Tables begin on D8
