FINANCIAL MARKETS : Stocks Churn, Dow Dips 1.04; Metals Rocket
Stocks closed mostly higher Wednesday in a session generally lacking fireworks--except for big gains in some precious metals.
The Dow Jones industrial average eased 1.04 points to 4,200.57 after surging 33.20 points to a record high Tuesday.
Winners topped losers by 12 to 10 on the New York Stock Exchange, and the NYSE composite and Standard & Poor’s 500 index hit record highs. But their gains were slight; the S&P; added 0.32 point to 505.56.
Technology stocks, which were hit by profit taking Tuesday, dove again in early trading Wednesday but generally rebounded by the close.
The Nasdaq composite index of mostly smaller stocks, dominated by tech companies, added 2.60 points to 816.32 for the day.
Traders described Wednesday’s session as one of consolidation after the market’s recent big gains. The Dow has surged 120 points just since mid-March.
News of a decline in the government’s index of leading economic indicators added more evidence that growth is slowing, and that helped push bond yields marginally lower Wednesday.
The yield on the Treasury’s 30-year bond eased to 7.36% from Tuesday’s 7.37%. The yield has fallen from 7.88% at year’s end as investors have bet on a slowing economy. The decline in yields has boosted bonds’ prices, which had tumbled last year as yields shot up.
So far this year, the dollar’s woes--which continued Wednesday--have failed to shake stock or bond markets. But some analysts are jittery over rising prices of precious metals, which often act as harbingers of higher inflation.
Platinum prices soared on Wednesday after Engelhard Corp., which makes anti-pollution devices for autos, said it has developed a new type of platinum coating for car radiators and air-conditioning condensers that removes existing pollution from the air.
“It would be an additional use for platinum,” said Harry Bingham, fund manager with Van Eck Global mutual funds in New York. There are no stockpiles of refined platinum, so “it doesn’t take too much to tighten the supply,” he said.
Platinum futures for April delivery rocketed $12.90 on the New York Merc to $461.60 an ounce, the highest in four years.
But analysts noted that Engelhard’s proposed coating wouldn’t be introduced on cars before 1998.
In any case, gold and silver were boosted with platinum. April gold futures rose $1.70 to $394.70 an ounce on the Comex; May silver futures jumped 10.8 cents to $5.41 an ounce.
Among Wednesday’s market highlights:
* Metal-related stocks led the market. Engelhard surged 8 5/8 to 38, Phelps Dodge gained 3/4 to 57 1/4, Asarco jumped 7/8 to 27 1/4, American Barrick added 5/8 to 25 3/8 and Alcoa rose 7/8 to 42 5/8.
* Many electric utilities continued to rebound for a second day. The Dow utility index jumped 2.24 points to 193.71, after gaining 3.76 points Tuesday.
* Among technology stocks, Micron Technology gained 7/8 to 75 1/8 after tumbling as low as 71 early in the day. Texas Instruments rose 2 to 91 after trading as low as 86 3/4. Other winners included IBM, up 1 to 84; Adobe Systems, up 2 1/2 to 50 3/4; Sybase up 1 3/8 to 24 3/8, and Cirrus Logic up 1 to 36.
* DuPont surged 1 5/8 to 63 1/4 amid expectations that it will buy back Seagram Co.’s 24% stake in the chemical giant. Seagram rose 1/8 to 28 5/8 after tumbling for two days.
* Some telecommunications stocks rose as Craig McCaw and his family agreed to invest up to $1.1 billion in mobile radio firm Nextel Communications. Nextel shot up 3 3/8 to 16 5/8. Other issues gaining included Dial Page, up 4 1/8 to 16 1/2; Comnet Cellular, up 1 3/4 to 27 1/8, and AirTouch, up 1/4 to 26 7/8.
Overseas, Tokyo’s 225-share Nikkei average closed up 251.96 points at 15,882.49. In Frankfurt, the DAX average added 4.83 points to 1,969.84; London’s FTSE-100 index rose 2.1 points to 3,190.2.
Mexico City’s Bolsa index closed 13.14 points higher at 1,919.09.
