Dow Posts a 1.74 Gain After Early Down Day
Stock prices were mixed today in the third straight day of light trading although the Dow eked out a small gain.
The Dow Jones average of 30 industrials increased 1.74 to 2,895.30. Broader indexes were down. The Dow average of 20 transportations was down 1.82 at 1,177.01 and the average of 15 utilities was down 0.38 at 208.56.
Declining issues outnumbered gainers by about 8 to 7 on the New York Stock Exchange, with 667 up, 767 down and 559 unchanged.
Big Board volume totaled 137.42 million shares, against 134.93 million in the previous session.
The NYSE’s composite index rose 0.23 to 195.84.
At the American Stock Exchange, the market value index dropped 0.02 to 360.81.
A midday report from the Federal Reserve that predicted slower economic growth and little change in inflation sent prices down quickly in the early afternoon. The report contained few surprises, but moved the waffling market.
“A little bit of news one way or another can turn this thing,” Alan Ackerman, senior vice president and market strategist at Gruntal & Co, said. Investors have been groping for the slightest signal of where interest rates are headed, market watchers said.
Late in the day stock prices began to recover.
Many investors, also apparently concerned about corporate profits, have sat out. Volume has been down to what Walter Murphy, senior market specialist at Merrill Lynch & Co., called “bordering on abysmal.”
Institutional investors have also apparently been sitting out, analysts said.
“It’s a period of marking time and waiting for things to happen,” said Edwin Kantor, chairman of Drexel Burnham Lambert Inc.
Bond prices were mostly lower in early trading today on the continued belief that the Federal Reserve would not ease monetary policy soon.
The Treasury’s benchmark 30-year bond was down 3/32 point, or 94 cents per $1,000 face amount, around midday. Its yield, which rises when prices fall, increased to 8.48% from 8.47% late Tuesday.
In the secondary market for Treasury bonds, prices of short-term governments were unchanged to up 1/32 point, intermediate maturities ranged from 1/32 point lower to 1/32 point higher and long-term issues were down 1/16 point, according to Telerate Inc., the financial information service.
Yields on three-month Treasury bills rose to 7.99% as the discount was up 1 basis point to 7.74%. Yields on six-month bills were 8.05% as the discount was unchanged at 7.64%. Yields on one-year bills were unchanged at 8.12% as the discount held at 7.57%.
