Dow ekes out 1.63 gain after wave of sell orders


December 10, 1992|By Bloomberg Business News

NEW YORK -- The three-week rally in U.S. stocks faltered a bi yesterday on renewed concerns about the outlook for International Business Machines Corp. and declines in high-flying auto issues.

The Dow Jones industrial average recovered late in the session to close up 1.63, at 3323.81, as gains in Aluminum Co. of America and United Technologies offset declines in IBM, Texaco, and General Motors. The Dow industrials climbed to the day's high of 3335.69 in late morning, before being knocked lower by a wave of computer-guided sell orders.

"It still looks to me like a lot of people are looking at any setback as an entry point," said Michael Metz, chief investment officer at Oppenheimer & Co. After finishing at all-time highs in nine of the past 10 sessions, the NASDAQ Combined Composite Index of over-the-counter issues lost 3.20, to 663.92.

Standard & Poor's 500 dropped 1.34 from Tuesday's record, to close at 435.65. Computer systems, international oil, health care, and automobiles were the biggest losers in the index.

Decliners outnumbered advancers by a margin of 9-to-5 among common stocks on the New York Stock Exchange in brisk trading. Turnover on the Big Board topped 230 million shares.

In other market averages, the American Stock Exchange Market Value index fell 1.67, to 392.98. The Dow Jones transportation index skidded 15.51, to 1413.35, with airlines leading the way.

IBM, the second-most-active NYSE stock, sank $2.625, to $62.75, after Standard & Poor's Corp. said it might strip the computer giant of its "AAA" credit rating. Stocks didn't get any help from the latest economic reports, traders said. The Commerce Department said wholesale inventories dipped 0.6 percent in October for the second straight month, while sales fell 1 percent, the biggest drop since May. Meantime, the Federal Reserve said the country's job growth is sluggish and economic growth remains uneven across the United States.

"The most significant thing I've seen is autos rolled over," said William Lord, a senior vice president in equity trading at Lehman Brothers. "They've been strong for three weeks, and that's not helping."

General Motors fell $1, to $33.75. Ford Motor Co., which set a three-month high of $43.125 yesterday, dropped 37.5 cents, to $42.75. Chrysler, also coming off a three-month high, fell 25 cents, to $33, as the stock went ex-dividend yesterday.

Sunward Technologies, Limited Inc., IBM, Chrysler and RJR Nabisco Holdings topped the most-active roster.

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