FINANCIAL MARKETS : Blue Chips Off, Techs Tepid in Windows Debut
Blue-chip stocks drifted lower Thursday as the hoopla surrounding the launch of Microsoft’s Windows 95 operating system failed to inspire a fresh rally in technology shares.
Nor could the market derive much strength from a plunge in bond yields, after a weaker-than-expected report on July orders for durable goods.
The Dow Jones industrial average eased 4.23 points to 4,580.62, the lowest since June 30. In the broad market, declining issues edged winners 1,112 to 1,089 on the New York Stock Exchange in moderate trading.
Wall Street’s inability to get a rise out of the bond rally or Germany’s latest cut in short-term interest rates is making some analysts nervous that the weakening market is headed for a more serious setback.
“People are nervous, like a horse in the middle of fly season,” said Ned Collins, head of equity trading at Daiwa Securities America.
Some traders said investors may be becoming more concerned about the prospects for another recession. The Commerce Department’s report that durable-goods orders fell 1.7% in July was a surprise. Analyst have assumed the economy was improving.
Among Thursday’s highlights:
* Profit taking in Microsoft led a broad decline in tech issues, which have been seesawing in recent sessions. Microsoft fell 1 3/4 to 96 1/8.
Other losers included Intel, down 1 11/16 to 61 1/16; IBM, off 1 3/4 to 104 7/8; Autodesk, down 1 3/4 to 44, and Texas Instruments, off 1 1/2 to 76.
The technology-laden Nasdaq composite index shed 7.26 points to 1,020.93.
* Weakness in the Dow was concentrated in Alcoa, off 5/8 to 58 3/8; Caterpillar, down 1 to 64 3/8, and Disney, down 1 1/4 to 56 1/8.
* On the plus side, some multinational stocks advanced as the dollar weakened again. Gillette gained 5/8 to 42 3/8, Procter & Gamble added 5/8 to 68 1/4 and Merck was up 5/8 to 50 5/8.
* Some initial public offerings made a splash. Plasma & Materials jumped 4 to 18 and Computron Software climbed nearly 3 1/4 to 20 3/4.
Analysts said the bond market reacted to data that showed the economy may be slowing.
The yield on the Treasury’s main 30-year bond fell to 6.81%, the lowest since July 18. On Wednesday, the bond’s yield closed at 6.91%.
In another report, the Labor Department said the number of Americans filing new unemployment claims rose last week by 10,000 to 348,000 in the week ended Aug. 19.
In overseas trading, Tokyo’s Nikkei average ended 190.01 points, or 1.07%, higher at 17,921.99. Mexico’s Bolsa index of 37 shares finished up 3.80 points, or 0.16%, at 2,447.04.
In Argentina, the Merval index dove 4.8% on fears that the country’s economics minister may be forced from office.
