Dow Rises 14.59 as Dollar Ends Skid Against Mark : Market Overview

* Stocks picked up steam as the dollar and bond markets provided a solid underpinning. The Dow Jones industrials rose 14.59 points to 3,246.81. Still, coming on top of a slim gain Tuesday, the Dow has regained less than a fifth of the 100 points it has lost in the last week.

* The dollar ended its sharp decline against the German mark, if temporarily. The dollar closed at 1.4065 marks in New York, up from Tuesday’s record low of 1.4015.

* The Tokyo market’s rebound continued, as the Nikkei index rose 160.88 points to 16,541.65. By midday today a new surge of buying drove the index up 910.38 points or 5.5% to 17,452.03.

Stocks

Traders attributed the market’s gains to activity in individual issues, rather than a sweeping change in market sentiment.

The market remains concerned about interest rates, the weak economy and the presidential race, analysts noted.

Still, advancing issues beat losers 10 to 7 on the Big Board. Volume eased 171.86 million shares from 207.76 million Tuesday.

The slumping dollar of recent days had fueled concern that U.S. interest rates might have to rise, to close wide gap between U.S. and European interest rates.

But on Wednesday, Wall Street took the view that the economy is too weak for the Federal Reserve to justify a rise in interest rates. That view was reinforced by news that orders for durable goods plummeted 3.4% in July.

In Tokyo, meanwhile, investors’ bullishness continued to rise in the wake of the government’s steps last week to stabilize the market and the banking system.

Since Aug. 18 the Nikkei has rocketed 23%, measured through midday today. Heavy buying of Japanese stocks this morning was powered by brokerage dealers making short-term trades on company accounts, analysts said.

Some traders also said the 17,000 level had been considered a short-term ceiling. So a close above that mark could spark a bigger rally.

Among U.S. market highlights:

* The Dow index was helped by gains in Allied-Signal, up 1 1/2 to 52 1/2; Kodak, up 1 1/2 to 45 1/8; Caterpillar, up 1 to 47 5/8; and Disney, up 1 to 33 7/8. Also, Philip Morris gained 7/8 to 80 5/8 after boosting its quarterly dividend 24%, to 65 cents a share from 52.5 cents.

* Telmex shot up 1 3/4 to 45 3/8, rebounding with the beleaguered Mexican stock market. In Mexico City, the Bolsa index soared 43.67 points, or 3.2%, to 1,396.76 as buyers hunted for bargains.

* On the NASDAQ market, SciMed Life jumped 6 3/4 to 56 1/2 on news that Eli Lilly, a competitor in catheter manufacturing, had suspended shipment of two products.

* Casino firm Circus Circus rose 7/8 to 46 3/8 after announcing plans for a theme park adjacent to its main Las Vegas casino.

* Among Southland issues, wheelchair maker Sunrise Medical gained 1 1/8 to 37 1/8 after reporting a 46% jump in fourth-quarter profits and declaring a 2-for-1 stock split.

Also, Fleetwood Enterprises rocketed 3 1/4 to 29 5/8 after the maker of recreational vehicles reported quarterly earnings up 19%.

* Among the day’s losers, Procter & Gamble lost 3/4 to 47 1/4 and Kimberly-Clark fell 1 to 54 1/8 after P&G; announced 7% price cuts on disposable diapers. The two firms are archrivals in that market.

In Europe, London’s 100-share Financial Times index stabilized, rising 4.0 points to 2,285.00. In Frankfurt, the DAX index added 4.37 points to 1,473.28.

Currency

The dollar continued to stabilize after hitting record lows against the German mark and against other currencies early in the week.

“The dollar is staking a base around 1.4 marks, but we’re still uncertain because that’s near its new low,” said Ziggy Zborowski, a trader at Bank Leumi Trust.

Traders said the dollar moved in a narrow range, partly on speculation about a realignment of the exchange rate mechanism of the European Monetary System, which links the currencies of most governments in the Common Market.

Reports that a member of Germany’s central bank supported a realignment boosted the mark temporarily. Later, the Bundesbank clarified that the official was only restating policy that realignment was possible.

Against the Japanese yen, the dollar closed at 124.85 in New York, up from 124.55.

Credit

Treasury bond yields fell across the board as the dollar rose, and as insurance firms failed to confirm rumors that they would flood the market with bonds to offset claims from Hurricane Andrew.

The price of the Treasury’s main 30-year bond was up 21/32 point, or $6.56 per $1,000. Its yield slid to 7.41% from 7.47% Tuesday.

Decent demand at an auction of five-year Treasury notes also helped sentiment.

The federal funds rate, the interest on overnight loans between banks, held steady at 3.3125%.

Commodities

Silver futures hit new contract lows on New York’s Comex after the government report on durable goods orders in July indicated that the economy remains stagnant.

Silver for September settled 3.2 cents lower at $3.67 an ounce; October gold lost $2.30 to $338.30 an ounce.

On the New York Merc, near-term light, sweet crude oil rose 6 cents to $21.21 a barrel.