Dow Rises 5.44 After Day of Seesaw Trading : Market Overview
Highlights of Monday’s market activity, compiled from Times staff and wire reports:
* Stock prices were mixed in a session of fits and starts marked by uncertainty over the future course of Federal Reserve credit policy and interest rates.
* The Dow Jones average of 30 industrials rose 5.44 points to 3,404.13. But declining issues slightly outnumbered advances on the New York Stock Exchange.
* Bond prices ended mixed in dull trading with little economic data or other news to move the market.
Stocks
Caution reigned on the economic front while uncertainty about the presidential race and a lack of leadership among stocks kept buying interest muted.
“There was really no theme to the market at all,” said Dale Tills, manager of institutional trading at Charles Schwab & Co. “It was a typical Monday, just dead.”
After Friday’s weak jobless report, which showed May unemployment rising to its highest level in nearly eight years, investors were looking for more clues on the economy.
Market sentiment was also unsettled by the presidential race, which has been marked by uncertainty amid the growing popularity of still-undeclared candidate Ross Perot.
“We don’t really know Perot,” said Robert Stovall, president of Stovall/21st Advisers. “Usually, a presidential election year gives us an up market . . . but in instances where the market is flat to down in the first half, the President frequently has trouble getting reelected.”
Big Board volume came to 161.24 million shares, down from Friday’s 291.35 million.
Among the market highlights:
* Abbott Laboratories led the active list, tumbling 4 1/8 to 27 3/4. Late Friday the company said it was voluntarily withdrawing its antibiotic product Omniflox from worldwide markets because of what it described as unexpected cases of adverse reactions.
* Several other pharmaceutical issues also came under pressure. Bristol-Myers Squibb, which issued disappointing earnings news last week, dropped 1 to 64 3/4; Glaxo Holdings fell 5/8 to 26 5/8; Merck declined 1/4 to 49 1/8, and Eli Lilly dipped 5/8 to 64 1/2.
* Elsewhere, Gulf States Utilities gained 1 1/4 to 15 3/4, while Entergy was down 1/8 at 27. The two companies agreed on a merger plan under which Gulf States holders would receive $20 a share in cash or stock.
* General Dynamics jumped 5 5/8 to 71. The company said it will offer to buy back as much as 30% of its stock.
* Other gainers among the blue chips included Philip Morris, up 1 5/8 at 76 1/8; Procter & Gamble, up 1 1/2 at 102 1/8; International Business Machines, up 3/4 at 91, and American Express, up 3/8 at 24.
Philip Morris shares rebounded from a 3 1/8-point loss last week, which was partly attributed to wariness over an impending Supreme Court ruling in a cigarette-liability case.
* Premark International rose 5/8 to 34 7/8, rebounding from a 9 1/2-point slide Friday when the company projected flat second-quarter earnings.
* Amdura jumped 1 3/4 to 6 5/8. The company, a producer of industrial hardware, declined to comment on the sharp recent run-up in its stock.
* In NASDAQ over-the-counter activity, MCI Communications rose 5/8 to 32 7/8. Analysts said they expected an orderly transition at the company following the death of its chairman and founder, William McGowan, of a heart attack Monday morning.
* Some OTC technology issues lost ground. Lotus Development dropped 1 7/8 to 26 1/2; Apple Computer fell 5/8 to 54 1/4, and Sun Microsystems declined 5/8 to 25 7/8.
In overseas trading, stocks ended weaker but off their lows in Tokyo. The 225-share Nikkei average finished down 134.98 points at 17,655.06.
The London Stock Exchange drifted lower, with the Financial Times 100-share average dropping 22.7 points to 2,645.8.
The Frankfurt bourse was closed for Pentecost. It will reopen today.
Credit
Monday’s closing of European markets other than those in Britain for Pentecost may have tempered U.S. activity, traders said.
The price of the Treasury’s key 30-year bond rose 1/32 point, or about 31 cents per $1,000 in face amount. Its yield held at 7.84%, unchanged from Friday.
But mostly, there was nothing new to trade on, they said.
The federal funds rate, the interest on overnight loans between banks, was 3.625%, up from 3.500% Friday.
Currency
The dollar closed mostly lower in extremely quiet trading.
Dealers said activity was subdued because of the absence of many European players.
The dollar held to particularly tight ranges in domestic trading. Its advance against the Japanese yen was a consequence of more active cross-trading in the yen and German marks, analysts said.
The dollar closed at 127.15 yen in New York, up from 126.65 Friday. However, it fell to 1.588 German marks, from 1.590.
The British pound dipped to $1.835 from Friday’s $1.834.
Commodities
Too much rain in the Southwest and too little in the Midwest sent cotton, soybeans and corn futures sharply higher on the nation’s futures markets.
Some cotton contracts advanced the 2-cent-a-pound limit for daily trading on the Cotton Exchange in New York.
Soybeans for delivery in July settled 15.25 cents higher at $6.215 a bushel; July wheat was 3 cents higher at $3.695 a bushel; July corn was 4.75 cents higher at $2.635 a bushel, and July oats were 4.75 cents higher at $1.425 a bushel.
Meanwhile, precious metals futures were lower at the Commodity Exchange in New York.
Gold for June delivery was 50 cents lower at $338.20 an ounce; June silver lost 1 cent to close at $4.041 an ounce.
Energy futures were mostly lower at the New York Mercantile Exchange, with light, sweet crude oil for July delivery falling 18 cents to $22.44 a barrel.
Market Roundup, D10
