Blue-Chip Stock Prices Rebound To Close Higher, but Others Fall
Prices of blue-chip stocks ended higher, but a late-afternoon advance wasn't enough to wipe out earlier losses in the rest of the market.</br></br>The Dow Jones Industrial Average closed 1.66 points higher at 1277.50, after retracing a loss of nearly eight points. However, on the New York Stock Exchange, 1,115 issues declined and 487 rose. Volume contracted to 89.7 million shares from 93.7 million shares Friday.</br></br>The broader market averages closed lower. Standard & Poor's 500-stock index fell 0.13 to 179.23, while the Big Board's composite index eased 0.19 to 103.82. In the over-the-counter market, which is viewed as an indicator of individual investors' action, the declines were even more pronounced. The Nasdaq OTC composite index fell 2.23 to 283.95.</br></br>Concern about interest rates moving higher has damped spirits in the equity market in recent sessions. A sharply weaker bond market at the start of yesterday's session, combined with a soaring dollar and more profit-taking by investors, contributed to an early decline in stock prices. Both bonds and stocks rebounded when the key rate on federal funds, reserves that banks lend each other, fell during the session.</br></br>Eugene Peroni, director of technical research at Bateman Eichler, Hill Richard in Los Angeles, noted that the 1270 level on the Dow Jones Industrial Average has generally provided some support for stocks as some buyers usually come into the market at that point.