Dow Flirts With 9,000, Yields Fall on Jobs Report

Wall Street’s best-known speedometer, the Dow Jones industrial average, passed 9,000 for the first time Friday, spurred by surprisingly positive economic news. The Dow retreated by the close, but other indexes managed to set records. Bond yields fell.

The blue-chip index hit an intraday record of 9,030.49, but ended the day 3.23 points down at 8,983.41. For the week, it gained 187.33.

The Dow accelerated past its latest 1,000-point milepost early in the session after the unexpected report of a drop in U.S. payrolls in March gave the bond market a boost.

The index’s failure to close above 9,000 wasn’t a surprise to some investors.

“The market has to test these 1,000-point marks a couple times before they stick,” said Paul Hennessey, head trader at Boston Partners Asset Management, which oversees about $15 billion. It took the 30-stock average six years to cross 1,000 after closing 4.86 points below the mark on Feb. 9, 1966. The Dow hit 8,000 points on July 16, 1997.

Broad-market indexes rose to records. The Standard & Poor’s 500 gained 2.69 points, or 0.2%, to 1,122.70, its third straight record, while the Nasdaq composite rose 2.44 points to 1,855.40, its fourth record in a row.

The New York Stock Exchange composite rose 1.04 points to a record 583.08, but the smaller-stock Russell 2,000 fell 0.64 point to 485.79.

Advancing stocks outnumbered decliners 15 to 14 on the NYSE in heavy trading.

Wall Street cheered the report that the jobless rate rose to 4.7% last month from 4.6%. The rise in the unemployment rate eased fears of an overheating economy that has been building after a series of strong reports.

The March drop in nonfarm payrolls, which tumbled an unexpected 36,000 after a revised gain of 252,000 in February--the first since January 1996--lessened the chance that the Federal Reserve Board will raise interest rates to cool the economy.

In the bond market, the yield on the key 30-year Treasury bond fell to 5.79% from 5.84% on Thursday..

The first-quarter earnings-reporting season kicks off next week. IBES International, an earnings-tracking firm, predicted that profits for the S&P; 500 companies will fall 0.4%. First Call, another tracker, expected a modest increase of 0.5%.

Both forecasts have been cut sharply since January.

Among Friday’s highlights:

* Financial services firms gained. Merrill Lynch rose $2.56 to $86.50 after Citicorp Chairman John Reed reportedly said he’s intrigued by the possibility of acquiring the securities firm. Citicorp rose 6 cents to $142.88.

American Express rose $4.50 to $99; Donaldson, Lufkin & Jenrette gained $1.63 to $87.69; and Chase Manhattan rose 81 cents to $140.13.

* Japan’s economic woes hit consumer-products stock. Procter & Gamble fell $1.56 to $88.13 amid concern that a slump in Japan’s economy will hurt overseas sales of its Cover Girl makeup, Head & Shoulders shampoo and Pampers diapers. Eastman Kodak fell $1.81 to $64.56 on concerns that it may be harder for it to compete with rival Fuji Photo Film’s prices because of the yen’s weakness against the dollar.

* The specter of less-than-stellar first-quarter profit growth kept many stocks in check. Oracle fell $2 to $28.13 after the database software company told analysts to revise expectations for earnings during the next three months.

In commodities markets, coffee fell nearly 3% to a 14-month low amid waning consumer demand and expectations for a bumper Brazilian crop.

A 13% drop in prices this quarter prompted Procter & Gamble to cut retail prices for its Folgers brand coffee, effective in May.

Coffee for May delivery fell $3.70 to $1.4550 a pound on the Coffee, Sugar & Cocoa Exchange, its lowest price since Jan. 31, 1997.

Market Roundup, D4