Market Ignores New Iraqi Attacks; Dow Gains 16.34
Wall Street stocks closed with moderate gains today, shrugging off new Iraqi missile attacks in the Persian Gulf war.
The Dow Jones average of 30 industrials ended up 16.34 points at 2,659.41. Advancing stocks outpaced decliners by a 9-5 margin on healthy New York Stock Exchange volume of 194.35 million shares.
For the week, the index was up about 13 points.
The market fell after news of new Iraqi missile attacks on Israel and Saudi Arabia, but it later recovered.
Nevertheless, brokers said the attacks heightened traders’ reluctance to carry big commitments into the weekend.
Marion Bass Securities analyst Ricky Harrington said three forces are driving the market--an anticipation that the war will be short, large amounts of uninvested cash and hopes for lower interest rates.
Stocks have drawn fresh support this week from indications by Alan Greenspan, chairman of the Federal Reserve Board, that the Fed stands ready to relax its credit policy further.
The government reported this morning that the gross national product fell at a 2.1% annual rate, after adjustment for inflation, in the fourth quarter of last year.
That decline, while smaller than some analysts had expected, was seen as ample encouragement for the Fed to keep looking for ways to stimulate business activity.
Among actively traded blue chips, General Electric rose 1 1/8 to 59 5/8 an hour before the close; International Business Machines gained 3/8 to 121 3/8; Philip Morris was unchanged at 54 1/2, and McDonald’s dropped 1/4 to 28 1/8.
Shares of General Dynamics fell on what analysts said was profit-taking. They were off 1 1/4 to 27 3/4.
Airborne Freight added 2 1/4 to 22 3/4. Its chief executive officer linked the rise to a recent ruling by the Department of Transportation.
Bond prices eased in early trading today following the GNP report that suggested much milder weakness than many strategists had predicted.
The Treasury’s bellwether 30-year bond fell 3/8 point, or $3.75 per $1,000 in face amount, around midday. Its yield, which moves in the opposite direction of price, was 8.19%, up from 8.16% late Thursday.
