FINANCIAL MARKETS : STOCKS : Closing Rally Pushes Dow 9.16 Higher
Selected blue chip buying nudged stocks higher Monday after the market had been stuck in a tight range most of the day.
The Dow Jones index of 30 industrials rose 9.16 to 2,914.11 on top of Friday’s 25.74-point gain.
In the broader market, advancing issues outnumbered declines in nationwide trading of New York Stock Exchange-listed stocks, with 764 up, 673 down and 545 unchanged.
A dearth of economic news contributed to what many analysts described as the summer doldrums.
“It’s like watching paint dry on the wall,” said William Raftery, technical analyst at Smith Barney, Harris Upham.
The relatively few investors trading Monday sought safe, dependable issues, considered to be immune from earnings disappointments, analysts said.
“When people are confused about the economy, that’s when they buy the blue chips,” said Phil Roth, chief technical analyst at Dean Witter Reynolds.
Among the active issues:
* Technology stocks generally were strong. Compaq jumped 3 to 64 5/8 on the first day of trading following its 2-for-1 split. Sun Microsystems rose 1 3/8 to 35 1/8, Autodesk rose 2 to 56 1/2, and Santa Ana-based computer lessor Amplicon added 1 to 8 1/2. But Digital Sound of Santa Barbara slumped 3/8 to 4 1/8 after announcing a second-quarter loss, as expected.
* Disney jumped 2 5/8 to 133 3/8. A Times story Sunday detailed the company’s tough business tactics.
* Two shoe stocks continued to rocket: Nike soared 7 1/4 to 87 1/4 after announcing strong fourth-quarter earnings. Pacoima-based competitor K Swiss rose 1 1/4 to 27 1/2. But other former industry stars continued to slump: L.A. Gear lost 1/8 to 28 1/2, and Reebok inched up just 1/8 to 17 3/4.
* LIVE Entertainment fell 1 1/4 to 21 1/2. The company’s Lieberman Enterprises unit is a supplier of recorded music to Wal-Mart, and Wal-Mart’s decision Monday to buy its own music supply outfit (a division of Western Merchandisers) raised fears that Lieberman will lose the account. Wal-Mart accounted for 23% of Lieberman’s 1989 sales. Also, independent music supplier Handleman fell 2 to 13 5/8 on the Wal-Mart news.
* El Monte-based electronics distributor Marshall Industries added 3/8 to 28 3/8. After the close, the company said it expects to report record fourth-quarter results of 70 to 72 cents a share.
Big Board volume came to 119.39 million shares, barely outpacing Friday’s 1990 low of 111.73 million.
In foreign trading, Tokyo stocks closed higher Monday in quiet trading, with most of the gains due to computer-linked program buying. The key 225-share Nikkei index was up 93.16 points to close at 32,538.28.
Stock prices ended modestly lower on London’s Stock Exchange amid limited buying interest. The Financial Times-Stock Exchange 100-share index fell 2.5 points to close at 2,337.5.
In Frankfurt, West Germany, shares lost early gains as follow-through orders failed to appear. The DAX index of 30 leading shares ended down 8.94 points at 1,923.86.
