Stocks retreat after advance Dow adds 9.31 points

broader market slumps as technologies slide

December 11, 1996|By BLOOMBERG BUSINESS NEWS

NEW YORK -- U.S. stocks closed mixed yesterday as record prices for Philip Morris Cos. and American Express Co. balanced a late slide in computer stocks such as America Online Inc. and oil-service companies like Schlumberger Ltd.

Marlboro cigarette maker Philip Morris and American Express helped drive up the Dow Jones industrial average 9.31 points to 6,473.25, adding to Monday's 82-point gain. At one point, the 30-stock average was ahead 48.45 points.

In the broader market, the Standard & Poor's 500 index fell 2.22 to 747.54, reversing an early 3.67-point advance, and the Nasdaq composite index slumped 3.72 to 1,312.55 after jumping 12.68 early in the day.

The Russell 2,000 index of small capitalization stocks gained gained 0.81 to 361.30; the Wilshire 5,000 index, comprising stocks on the New York, American and Nasdaq exchanges, fell 13.48 to 7,250.32; the American Stock Exchange market value index climbed 0.31 to 590.79; and the S&P midcap index lost 0.63 to 256.21.

Maryland stocks rose, led by Sinclair Broadcast Group-A, which gained $3.25 to $26.25, and Alex. Brown Inc., which climbed $2.625 to $69.375.

About 1,410 stocks rose and 1,155 fell on the New York Stock Exchange.

Oil service stocks, among this year's best-performing industries, tumbled as crude oil futures plunged. Texas oil prices fell 88 cents as Iraq test-pumped an oil pipeline to Turkey, clearing up lingering doubts that it would soon begin exporting oil for the first time since 1990.

Schlumberger Ltd. dropped $2.50 to $100.875; Halliburton Co. fell $1.875 to $58.50; Dresser Industries Inc. tumbled $1.125 to $31; and Baker Hughes Inc. fell $1.375 to $35.

Computer stocks suffered a late reversal after first rallying in Asia, Europe, and then the United States. A Semiconductor Industry Association report late Monday said U.S. manufacturers received $115 in new orders last month for every $100 worth of goods they shipped.

Gateway 2000, a personal computer maker, said at an investment conference that sales growth in the fourth quarter compared with the third quarter would fall below last year's 40 percent.

Gateway plunged $5.25 to $58.875; Cascade Communications Corp. tumbled $6.625 to $61.875; and Tellabs Inc. skidded $2.75 to $42.50.

America Online Inc. dropped $2.625 to $36. Microsoft rolled out an updated version of its own online service, gunning for AOL's more than 7 million consumers.

Microsoft, the world's largest software publisher, gained 12.5 cents to $81.875 after being up $2.6875, and Intel, the country's biggest semiconductor producer, slid 41 to $129.125 after jumping $4.25.

Dell Computer Corp. dropped 75 cents to $59.625 after climbing $4.75; Texas Instruments Corp., a computer chip manufacturer, finished unchanged at $66.625 after climbing $1.75; Motorola Inc. gained 50 cents to $55.25 after rising $1.625, and Oracle Corp. finished up 62.5 cents to $49.375 after jumping $1.875.

Computer Sciences Corp. surged $2.75 to $84.50 and Sun Microsystems Inc. advanced $1.625 to $61.375.

Philip Morris climbed $2.125 to $116.375, its fourth consecutive record.

Late Monday, Goldman, Sachs & Co. raised its price target for the stock to $135 a share from $125 a share. Philip Morris, also the maker of Kraft cheese and Miller beer, has surged almost 14 points, or 13 percent, in a week.

American Express soared to a record $54.875, up $2.875, amid speculation that the charge-card company, whose market capitalization is about $26 billion, might be bought by Citicorp, which was down 25 cents to $103.75.

Komag Inc. slumped $5.875 to $27.25. Fourth-quarter profits will be lower than the 31 cents a share reported in the third quarter.

Pub Date: 12/11/96

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