Blue-chip stocks ended higher Wednesday as many cautious investors stayed away from the market ahead of third-quarter corporate earnings reports and a new reading on the economy.
* Silver futures prices reached a four-week high on New York's Comex in a speculative rally ignited by Middle Eastern options dealings. Gold also moved higher.
* Long-term Treasury bond yields were unchanged as investors refrained from major moves ahead of the government's report on September employment due out Friday.
Higher stocks abroad set an early firm tone to the market, with share prices in London setting a record high.
But caution set into the market as bonds wavered, trading in narrow ranges, before finally settling on a narrowly higher course.
The Dow Jones industrial average rose 11.73 points to 3,598.99.
Most investors were wary of making any significant commitments ahead of corporate profit reports, due out later this month for the three-month period that ended with September.
"The market's waiting for a better fix on third-quarter earnings," said Bill Allyn, managing director at Jefferies & Co.
Investors, analysts said, were also waiting for Friday's September unemployment report for indications as to the strength of the economy. Recent government data has given the economy mixed reviews.
"There was no incentive to get aggressive in either direction," said Michael Metz, an investment strategist with Oppenheimer & Co.
But John McDevitt, corporate economist with Minnesota, Mining & Manufacturing, said the concern about the economy was overdone and that for the most part, earnings reports would not disappoint.
"Companies have greater confidence in their ability to survive recession, to grow in a slow-growth economy" he said.
"The outlook seems to be improving," McDevitt said.
Overseas markets finished generally higher. London's Financial Times 100-share average scraped to a new record closing high 3,100, up 15.6 points.
In Frankfurt, the DAX-30 average ended 14.32 points firmer on the day at 1,987.05, while Tokyo's 225-share Nikkei average gained 178.32 points to close at 20,500.25.
On the Sydney Stock Exchange, the all ordinaries average surged through the 2,000 mark for the first time since "Black Monday" in October, 1987.
In the broader market, advancing issues outnumbered declines by about 9 to 7 on New York Stock Exchange volume of 286.9 million shares.
Among the market highlights:
* ARCO shed 2 3/8 to 112 1/4 and Union Texas dropped 3 3/8 to 21 3/4 on news of disappointing drilling results in the Beaufort Sea.
* Many technology stocks recovered somewhat from Tuesday's downturn after Advanced Micro Devices announced worse than expected third-quarter earnings. While AMD fell 7/8 to 21 1/8 after S.G. Warburg downgraded the stock, other computer issues ended firmer. National Semiconductor rose 1/2 to 19 3/8 on the NYSE. Cirrus Logic rose 1 7/8 to 32 5/8 and Cypress Semiconductor was up 1/2 to 13 1/2. But Intel Corp. ended down 3/4 to 69 1/4 after rising to 71 1/2 early in the session.
* National Medical Enterprises rose 1 3/8 to 11 1/2. Salomon Bros. raised a rating on the stock, saying the worst is behind the company after last week's settlement of two major lawsuits.
* Goodyear Tire & Rubber rose 1 1/8 to 46 1/2 after it forecast sharply higher third quarter earnings.
* The Nasdaq composite index, meanwhile, rose 2.33 to 764.58.
The silver rally began overnight with Middle Eastern purchases in London of large lots of call options, according to Bernard Savaiko, senior metals analyst for Paine Webber Inc. A call option grants its holder the right to buy silver at a designated price within a set time frame.
On the New York Comex, silver for current delivery closed at $4.265 an ounce, up 20.2 cents. Gold followed silver higher, rising to $356.40 an ounce, up $3.40 from Tuesday.
The options dealings prompted investment funds and other speculators to buy options and futures contracts, which lifted prices and brought in still more buying, analysts said.
Analysts were skeptical about the silver market's ability to maintain the higher levels for long.
In other markets:
* The Treasury's key 30-year bond was unchanged at 6.0%.
In the Treasury market, investors focused on economists' predictions of the September job statistics. Most forecasts call for a roughly 150,000 increase in non-farm payroll jobs, which would suggest continued slow economic growth.
Such results would tend to support the market's recent rally, since economic sluggishness helps put a lid on inflation. High inflation can hurt the value of fixed-income securities such as Treasury bonds.
* Light sweet crude for November delivery rose 3 cents to $18.42 a barrel.
* The dollar finished mixed against other major currencies as investors continued to flow back into the German mark during a day of quiet trading.
Market Roundup, D6