FINANCIAL MARKETS : Stocks End Mixed; Dollar Bounces Back
Wall Street stocks struggled to an indecisive close Thursday, a sharp run-up in the shares of high-technology companies notwithstanding. The dollar was definitely strengthened, however, bouncing back in thin trading as panic over Mexico’s financial crisis subsided.
Many investors were selling to establish losses for tax purposes, traders said, something that will continue through Friday, the final session for 1994. In addition, some options expirations coming up on the last day of the year had a mixed effect on stock prices.
“Clearly a handful of technology stocks are doing their own thing while the Dow stocks are cooling off,” said Trude Latimer of Ferguson, Andrews & Associates Inc.
The markets showed little reaction to two important pieces of economic news: The Commerce Department reported that the index of leading economic indicators rose 0.3% in November, its biggest increase since August. The increase raised expectations that the economic recovery will continue. Those expectations were also fed by the Labor Department’s report that 3,000 fewer Americans sought unemployment benefits last week, more than compensating for the 2,000-person increase for the week before.
The Dow Jones industrial average ended off 6.06 points at 3,833.43. Advances beat declines 1,165 to 1,093 on a light volume of 250.5 million shares on the New York Stock Exchange, up from 243.5 million Wednesday.
The Nasdaq composite rose 7.07 to 749.53, reflecting gains in stocks such as Intel and Dell Computer. Intel added $1.875 to 64.375, and Dell gained 1 5/16 to 41 15/16.
“The Dow has been leading the market, and I guess it’s taking a back seat today,” said Hildegard Zagorski of Prudential Securities. The Dow has risen nearly 200 points from early December through the Tuesday after Christmas, but the blue chip index retreated 22 points on Wednesday.
In late New York trading, the dollar was quoted at 1.5533 German marks, up from 1.5425 late Wednesday. The dollar also was changing hands in New York at 99.70 Japanese yen, up from 99.21 Wednesday.
Bond market activity has been extremely slow this holiday week. On Thursday, the yield of the Treasury’s main 30-year bond held at Wednesday’s close of 7.83%.
The Standard & Poor’s composite index of 500 stocks rose 0.31 to 461.17.
The NYSE Composite index of all listed common stocks rose 0.15 to 251.44. The average price per share rose 2 cents.
Among the market highlights:
* Some retailing stocks that had come under pressure earlier in the week made partial recoveries. Toys R Us, which lost 3 1/8 on Wednesday, rose 3/8 to 30 1/2. Ann Taylor gained 2 5/8 to 34 1/2, and Dayton Hudson rose 2 1/2 to 69 7/8.
* Telefonos de Mexico ADRs ?? gained 7/8 to 42 3/8 as bargain hunters were attracted to stocks that had been badly battered by last week’s peso devaluation.
* Micron Technology rose 1 to 45 1/8 after Goldman, Sachs raised its earnings estimates for the company’s 1995, 1996 and 1997 fiscal years. Hewlett Packard rose 2 1/8 to 102 1/4 after Smith Barney upgraded its rating to “buy” from “attractive.”
* Copper prices rose to their highest level in six years Thursday with economic recoveries in the United States, Japan and Germany, fueling a rally that analysts say shows no sign of slowing. Demand from Asia has also been boosted by the prolonged closure of the Philippines’ only smelter. The smelter was shut before the Christmas holiday because of typhoon damage, and it is not expected to reopen until next week. Copper futures on New York’s Commodity Exchange set contract highs on most months, with March delivery closing up 0.15 cent at 138.05 cents per pound, just below the day’s peak of 138.40 cents.
Since the beginning of the year, copper has soared by about 70%. Its demand is forecast to grow by more than 3% next year, and since no new mine or refinery output will be on stream until the second half of 1995, copper supplies should fall steadily, analysts said.
* Tokyo stocks were steady, with the 225-share Nikkei average ending 87.45 points higher at 19,752.98. London equities finished broadly lower. Dealers said thin post-Christmas trading exaggerated the downturn. The FTSE 100 index, which had risen in eight of the previous 10 sessions, dropped 30.2 to 3,065.6. The German DAX index ended down 31.98 points at 2,077.03. In post-bourse trading, the DAX eased to 2,074.68.
