FINANCIAL MARKETS : Dow Again Hits New High, but Nasdaq Drops

Market Overview

* The Dow industrials surged to a new high, but the broad market finished mixed as some disappointing technology company earnings depressed the Nasdaq market.

Meanwhile, many foreign markets regained their footing and rallied briskly.

* Long-term Treasury bond yields inched higher as investors weighed the potential impact of upcoming government note and bond sales. In commodity markets, oil prices gained again.

Stocks

A torrent of buyers again entered the market, but there were plenty of sellers as well--leaving broad market indexes only marginally higher.

Though the Dow climbed 14.08 points to a record 3,884.37, the Standard & Poor’s 500 index added just 0.05 point to 474.30. And winners topped losers by a slim 11 to 10 on the New York Stock Exchange on heavy volume of 311 million shares.

The Nasdaq market of mostly smaller stocks was weighed down by disappointing profit reports from some of the biggest firms traded there. The Nasdaq composite index lost 3.74 points to 789.28.

But a truer measure of small-stock performance, the Russell 2,000 index, joined the Dow industrials at a new high, adding 0.20 point to 262.20.

Some analysts said the broad market gave a good account of itself considering the impact of lower than expected corporate earnings reports.

Computer chip giant Intel, for example, plunged 4 3/4 to 62 1/2 after reporting quarterly earnings that fell short of analysts’ estimates, even though the company’s results were up 38% from a year ago.

In the drug group, Pfizer plummeted 5 to 62 7/8 on its weak earnings report.

And book publisher Houghton-Mifflin tumbled 6 7/8 to 46. It said 1994 earnings will be 10% lower than projections because of an expected drop in textbook sales.

Despite the earnings shortfalls, Wall Street was pulled up by continued strength in industrial stocks and in some energy issues.

Among Wednesday’s highlights:

* The Dow was boosted by Alcoa, up 1 to 74 7/8; 3M, up 2 to 111 3/8; McDonald’s, up 1 3/8 to 58 7/8, and Caterpillar, up 7/8 to 93 5/8.

Among other industrial names, Briggs & Stratton surged 3 5/8 to 85, Kennametal leaped 1 7/8 to 47 7/8, Air Products & Chemicals gained 1 3/8 to 48 3/4 and ITT jumped 1 5/8 to 94 1/4.

* Rising energy prices resulting from the cold wave in the East drove natural gas stocks up. Coastal rose 1 to 30, KN Energy added 7/8 to 24 1/8, Enserch gained 5/8 to 18 1/8 and Enron Corp. was up 1 1/8 to 32 1/8.

Elsewhere, Columbia Gas leaped 3 1/8 to 26 1/4 after the eastern gas utility filed a reorganization plan that would bring it out of Chapter 11 bankruptcy.

* Telephone stocks were strong. Ameritech soared 3 3/4 to 78 7/8 after reporting fourth-quarter earnings were up 19%. Other gainers included Bell Atlantic, 1 1/4 to 55 7/8; BellSouth, up 7/8 to 56 1/2, and MCI, which rose 1 1/8 to 27 1/2.

* On the downside, technology company earnings disappointments were the rule of the day. Digital Equipment sank 3 3/4 to 32 3/4 after reporting a quarterly loss and issuing a cautious outlook.

Software firm Borland lost 1 1/2 to 13 7/8 after reporting sharply lower earnings.

Meanwhile, Microsoft slid 1 3/8 to 83 1/4, but after the market closed it reported quarterly earnings were up 22%, better than expected.

* Drug stocks followed Pfizer lower after its weak earnings report. Merck fell 3/4 to 35 7/8, Lilly lost 1 5/8 to 59 7/8, Schering-Plough sank 1 7/8 to 64 3/8 and American Home Products eased 7/8 to 64 1/4.

In foreign markets, Tokyo’s Nikkei index rocketed 524.85 points to 19,039.40, its first close above 19,000 since Nov. 2.

In Frankfurt, the DAX index gained 20.54 points to 2,134.38, and London’s FTSE-100 index soared 38.1 points to 3,475.1.

Mexico City’s Bolsa index surged 44.88 points to 2,601.50.

Other Markets

Treasury bond yields edged higher as investors focused on upcoming bond offerings. The Treasury said it will auction $17 billion in two-year notes and $12 billion in five-year notes next Tuesday and Wednesday.

The 30-year T-bond yield closed at 6.29%, up from Tuesday’s 6.26% close.

Also pressuring bond yields was an upbeat Federal Reserve Board report showing fresh “signs of acceleration” in the economy as 1994 began.

In other markets:

* Crude oil futures ended 35 cents higher at $15.22 a barrel on the New York Merc.

* Near-term gold futures eased 80 cents to $392.30 an ounce on the New York Comex. Silver was unchanged at $5.33.