Stocks Stage Small Rally on Good Bond News
NEW YORK, June 3ÛÓThe stock market, encouraged by hopes of lower interest rates, chalked up a modest gain after posting losses for most of today.</br></br>The Dow Jones average of 30 industrials, which had dropped back 14.76 points on Monday, rose by 8.48 points to close at 1,870.43 in lackluster trading.</br></br>Analysts said investors were encouraged by a rally in the bond market that picked up following a remark by U.S. Treasury Secretary James A. Baker III indicating that</br></br>Recent reports pointing toward a strong economic performance in the second half have led to fears that interest rates might stabilize, or even begin rising if the Federal Reserve Board moved to inhibit tbe return of inflation.</br></br>This prospect contributed strongly to MondayÛªs stock market decline, which was aggravated by computerized program trades, buying stock-index futures contracts while selling ÛÏbasketsÛªÛª of individual stocks.