Stocks closed mixed Thursday after Wednesday’s sharp late slide, as many traders braced for today’s report on January employment trends.
Meanwhile, the bond market was relatively calm, while oil prices slumped on news of heavy OPEC production. The muscle-bound dollar continued to strengthen.
On Wall Street, the Dow Jones industrials, which dove 86.58 points Wednesday in a sell-off fueled by tumbling technology issues, gained 26.16 points to 6,773.06 on Thursday.
The Nasdaq composite index, down 25.31 points Wednesday as bellwether issue Intel dropped sharply, eased just 2.04 points to 1,346.40 on Thursday.
Winners and losers were nearly evenly matched on the New York Stock Exchange and on Nasdaq.
“The market is on edge, so people freeze” ahead of a major economic report, such as today’s January employment report, said Mike Clark, trader at Credit Suisse First Boston.
The data will give investors a sense of the momentum--or lack thereof--with which the economy began the year, after a surprisingly strong fourth quarter.
A large gain in jobs in the month, or a burst in wage growth, could cause the bond market to unravel again on fears that the Federal Reserve Board will tighten credit sooner rather than later.
After rising to four-month highs in January, long-term bond yields have sunk over the last week. The Fed, meeting earlier this week, left its benchmark short-term rates unchanged--opting, for now, to give the economy more breathing room.
On Thursday the 30-year Treasury bond yield held steady at 6.75%, the same as Wednesday.
In the stock market, retail issues were strong on news of robust January sales gains for many chains.
The tech sector also was relatively firm, despite another decline in Intel shares. Intel lost 4 1/8 to 153 1/8 in continued profit taking that was sparked Wednesday after at least two analysts downgraded the stock, saying it had run up too quickly recently.
In currency trading, the dollar continued its ascent, closing at a four-year high against the Japanese yen. News of a record German unemployment rate of 12.2% also boosted the dollar to a 2 1/2-year high against the mark. The dollar finished at 123.54 yen and 1.650 marks in New York.
Finance ministers of the Group of Seven industrialized nations meet Saturday, but whether they will attempt to talk the dollar down remains uncertain.
Meanwhile, in commodity trading, near-term crude oil futures fell 81 cents to $23.10 a barrel in New York after Reuters reported that OPEC oil production in January reached a 16-year high.
Among Thursday’s highlights:
* Sears led retail issues higher and helped boost the Dow industrial index. Sears gained 1 1/4 to 49 3/4. Other retail stocks rising included Gap, up 2 1/4 to 32 1/8; Wal-Mart, up 1/2 to 23 5/8; Ross Stores, up 1 1/2 to 43 1/2; and Federated Department Stores, up 1/2 to 33 3/4.
* Rebounding tech issues included Apple, up 3/4 to 16; Motorola, up 2 1/8 to 66 3/8; Western Digital, up 3 to 66 3/8; and Cisco Systems, up 7/8 to 63 7/8. But IBM dropped 2 3/8 to 146 and Microsoft was down 1 1/4 to 97 1/8.
* Manpower rocketed 5 5/8 at 35 5/8 as the temporary-help company reported fourth-quarter earnings above analysts’ expectations.
* Dean Witter added 1/2 to 41 1/8 and Morgan Stanley was up 1 1/4 to 66 1/2 one day after their surprise merger announcement. Many other brokerage issues also were higher.
* On the downside, energy stocks continued to slide as oil prices fell. Atlantic Richfield dropped 1 7/8 to 129 5/8, Unocal lost 1 to 43 3/8, Western Atlas gave up 1 3/8 to 62 1/2 and Oryx Energy sank 1 3/8 to 22 1/2.
* Pete’s Brewing fell 13/16 to a record low of 5 1/8 after the Palo Alto-based craft-beer brewer compounded investors’ worries with a forecast of lower first-quarter earnings and no growth in shipments.