STOCKS : Dow Rises 4.25 in ‘Aftershock’ of Friday Selloff

Stocks posted small gains Monday, but trading was light with many investors staying on the sidelines after Friday’s selloff.

The Dow Jones industrial average rose 4.25 points to close at 2,924.42 after remaining in a narrow range for most of the day.

The Dow had tumbled 50.98 points on Friday, continuing what has been a seesaw market of late.

Monday, advancing issues narrowly outpaced losers among New York Stock Exchange-listed stocks, with 787 up and 777 down.

Big Board volume plunged to 129.62 million shares, down from 172.73 million Friday.

“There’s basically still an aftershock from Friday’s session,” said Robert Walberg, analyst at MMS International. “There’s no confidence. Nobody’s excited about jumping in.”

Traders said many investors are waiting for more economic reports that might hint at when the economy will begin to turn. A report Monday that industrial production rose slightly in April did not sway most Wall Streeters.

Among the market highlights:

* American Express topped the most-active list, losing 1 to 22 7/8. Analysts cut earnings estimates in the wake of the firm’s problems with its investment in troubled insurer First Capital Holdings.

* Some recently battered high-tech stocks rebounded. IBM gained 2 1/2 to 105 7/8, DEC rose 1 7/8 to 67 7/8 and Motorola jumped 1 5/8 to 65 3/8. Among smaller tech issues, El Segundo-based Aura Systems rose 5/8 to 6 1/2 after announcing that it will begin trading on NASDAQ’s National Market System on May 21.

* Nordstrom soared 2 3/4 to 44 after reporting strong first-quarter results. Another retailer, Dillard Department Stores, added 4 7/8 to 123 1/4 after reporting strong sales and higher-than-expected profits.

* Live Entertainment slumped 1 5/8 to 11 1/8 after an analyst downgraded the stock to “hold.”

* Office products retailer BizMart rose 1 3/4 to 16 1/4 after it agreed to be acquired by computer-store chain Intelligent Electronics for $16.50 a share. Intelligent fell 2 1/4 to 24 3/4.

In foreign trading, British shares extended morning losses to end at the day’s lows. The Financial Times 100 average closed at 2,486.6, down 37.7 points.

In Frankfurt, a revival of rumors that Bundesbank President Karl Otto Poehl may resign later this year sent German share prices lower. The 30-share DAX average fell 9.73 points to 1,610.90.

In Tokyo, the Nikkei average slid 181.09 points to 26,093.20.

Credit

Interest rates eased in the bond market, as some traders viewed Friday’s big bond selloff as an overreaction.

The Treasury’s 30-year bond rose 5/8 point, or $6.25 per $1,000 in face amount. Its yield was 8.25%, down from 8.31% Friday.

The bond’s yield had jumped sharply Friday as a barrage of rumors hit the market, suggesting some big investors were ready to dump bonds. But many traders said there simply were too many Treasury bonds still floating around from last week’s record $37-billion Treasury auction, and that the excess supply caused brief panic selling on Friday.

Many bond traders are hoping that Federal Reserve policy-makers, meeting today in Washington, will move to lower interest rates further.

The federal funds rate, the rate on overnight loans between banks, rose to 5.81% from 5.50% Friday.

Currency

The dollar ended lower against most major currencies except the Japanese yen, which was pressured by speculation of declining interest rates in that country.

The dollar closed at 139.45 yen in New York, up from 138.70 Friday. It also ended at 1.714 German marks, down from 1.723 Friday.

Commodities

Copper futures sank to a 15-month low on New York’s Commodity Exchange as weak industrial demand and rising supplies pressed the metal’s price.

Copper futures settled 1.95 to 3.1 cents lower, with the contract for delivery in May at $1.007 a pound, the lowest daily finish for spot copper since Feb. 8, 1990.

Copper has been sliding since late in the third quarter of 1990, when slowing industrial production translated into weakening demand. The metal is widely used in the construction, automobile and electronics industries.

Silver futures also weakened on the Comex amid pessimism about the economy. Silver was 3.4 to 3.7 cents lower, with May at $3.99 an ounce. Gold, however, ended $1.50 higher across the board, with May at $358.60.

On the New York Mercantile Exchange, light sweet crude oil settled 3 to 36 cents lower, with June at $20.91 a barrel.