Wall St slips after rally

Press, 20 August 1984, Page 31

Wall St slips after rally

NZPA-AP New York The New York stock market struggled to hold on to a moderate advance on Friday after a rally on Thursday. After the market closed on Friday, the -Federal Reserve Board reported a larger-toan-expected SUSS.2 billion increase in the basic measure of the American money supply. But the news had no great impact on the credit markets. Analysts noted that monetary growth remained within the Federal Reserve Board’s target range. After a strong showing on Thursday, bond prices declined slightly on Friday. The Dow Jones average of 30 industrials rose 2.76 points to close at 1211.90, finishing the week with a net loss of 6.19 points. Advances slightly outnumbered declines bn the New York Stock Exchange. Volume totalled 71.50 million shares. Last week began with stock prices fluctuating in slackened trading as interest rates rose.

Many traders appeared to believe that the stock market had come too far too fast in its rally of the Crevious two weeks. That elief was reinforced by the market’s showing on Friday, August 10, when it rose sharply in early trading but then fell to finish mixed. Another drag on stock prices as the new trading week began was a rise in open-market interest rates. Prices of long-term United States Government bonds, which move in the opposite direction from interest rates, fell more than,ss on Monday for every $lOOO in face value. The Dow Jones, down about nine points at its midday low, closed with a 1.99 point gain at 1220.08. On Tuesday the market drifted lower after an early advance faded. Before the market opened the Commerce Department reported a 0.9 per cent drop in United States retail sales for July. Most analysts had been expecting an increase. Brokers said the news was taken as fresh evidence

that American economic growth was tapering off to a slower pace that might be sustained for a longer period of time, with lower interest rates. “Slower growth in consumer spending should help to relieve pressure on the credit markets,” said Mr Malcolm Baldrige, the Secretary of Commerce. But after responding favourably to the news at first, stock prices sagged. The market fell again on Wednesday, amid concern among investors about problems facing the Financial Corp, of America. Financial Corp, the parent company of American Savings and Loan, the nation’s largest thrift institution, said that it has restated its second-quarter earnings to show a $107.5M loss. It also reported that American Savings failed to comply with Government liquidity regulations in July because of a savings outflow. Mr Charles Knapp, the FCA’s chief executive, said toe company “is soqnd and

economically viable,” but FCA shares tumbled as toe most actively traded issue. Also actively traded was American Express, which declined on speculation that the stock might be depressed should FCA sell the 4.9 per cent interest in American Express shares it reported having acquired early this year. The Dow Jones average of 30 industrials dropped 15.13 points to close at 1198.98. On Thursday, the market rallied, toe Dow Jones rising 10.16 points to close at 1209.14. The Government reported that housing starts dropped 6.6 per cent in July. The figure was taken as new evidence that the pace of American economic expansion was slackening, possibly allowing room for lower interest rates. Rates fell in the bond market on Thursday as traders bid prices of longterm United States Government bonds up as much as $lO for every $lOOO in face value. Analysts said stocks seemed to attract some buying from traders who had been waiting for stocks to fall back after the market’s

powerful early-August rally. Alcan, 29%; Alcoa, 36%; AmeradHes, 25%; ABC, 67%; AmEx, 31%; AmMtrs, 4%; ATT, 18%; Arinco, 12%; Asarco, 22%; Atlßich, 45%; BethStl, 19; Boeing, 51%; Borden, 59; Burroughs, 57%; Chrysler, 29%;' Citicorp, 33%; Coca Cola, 60%: Colgate, 22%; CBS, 83%; ContlGrp, 56%; Crane, 36%; DarandKrft, 76%; Digital 93%; Disney, 57%; Dome Mines, 10%; Dowchem, 30%; DuPont, 47; East Kodak, 74%; Englhrd, 25%; Exxon, 41%; Firestone, 18%; Fluor, 16%; Ford, 44%; FrptmcM, 17%; GenDynam, 62%; GenElec, 57%; GM, 74%; Goodyear, 28%; Greyhound, 22%; Grumman, 28%; Haliburton, 33; Homestake, 26%; Honeywell, 64%; IBM, 123; IntH, 6%; INCO, 11%; ITT, 26%; Mans-, ville, 8%; JhsnandJhsn, 33%; KaiserAlu, 15%; KMart, 32%; Lockheed, 45; Levi Strauss, 26%; Mcdonald’s, 79%; McDonDoug, 67%; MGM, 13%; MMM, 83%; Mobil 26%; Monsanto, 48%; NCR, 27%; NewmMin, 38; Pfizer, 36%; PhelDodge, 17%; Phil Pete, 37%; Polaroid, 30; RCA, 34%; Raytheon, 41%; ReynMetal, 30%; RoylDPet, 48%; Seagrams, 36; Searsßoe, 35%; SheUOil 55%; Shellßt, 32%; Sperry, 40%; StOillnd, 56%; Sohio, 45%; Texaco, 35%; Texaslnst, 141; UnionCarb, 55%; USSteel 24; WestgEle, 25%; Wlwth, 35%; Xerox, 38%; Schlumberger, 45%; Sedco, 30%; MerrylLynch, 31%; Occidental 28%; Heinze, 37%; Clevel’dCliff, 21%; Int Nth, 36%; AAirlines, 27%.