Worrisome Economic News Rattles Investors

Stocks ended a fitful session mixed Friday, as the twin threats of a slowing economy and inflation sent the blue chips lower.

The Dow industrial average slid 36 points, but recovered most of that loss, closing down 12.79 at 4,192.62.

The Dow underperformed broader market indexes, which ended mixed.

Declining issues edged out advancers by about 11 to 9 on the New York Stock Exchange. Big Board volume was heavy at 314.48 million shares as of 4 p.m., against 320.42 million Thursday.

Stocks started the day on the plus side, as longterm Treasury bonds rallied 1/2 point on a Labor Department report that the nation’s unemployment rate edged up 0.1 percent to 5.5 percent in March. Payroll employment climbed by 203,000 jobs, markedly lower than the 345,000 gain in February and less than the 225,000 anticipated by economists.

Bond investors usually like weak economic news, because it generally means that inflation is waning.

But the data did nothing to strengthen the dollar, which hit a low against the yen and traded at depressed levels throughout the day. The dollar was trading at 83.99 yen late in the day, down nearly a yen.

The dollar’s weakness helped reverse the gains in bonds and pressured the Dow lower.

Some of the stocks that moved substantially or traded heavily Friday:

NYSE

Chase Manhattan rose 7/8 to 42 1/2.

The stock rose for the second day after investor Michael Price disclosed he had taken a 6.1 percent stake in the banking company. Friday, Merrill Lynch raised its intermediate-term rating to “above average” from “neutral,” saying Price’s move should prompt further restructuring.

Seagram fell 1 3/4 to 26 1/8.

Oppenheimer downgraded the stock to “underperform” from “market perform,” following reports of Seagram’s plan to buy 80 percent of MCA Inc. from Matsushita Electric Industrial Co. for $7 billion. Oppenheimer said the deal could lower Seagram’s short-term earnings and it was unclear whether it would be positive long-term.

DuPont rose 2 3/8 to 62 3/8.

The stock recovered after falling Thursday. DuPont agreed to buy back Seagram Co.’s 24.2 percent DuPont stake for $8.8 billion, to be financed in part from operating cash and from offerings of equity securities. Smith Barney downgraded the stock, but PaineWebber upgraded it.

Digital rose 1 7/8 to 40 3/4.

The computer maker said it will revive an alliance with Oracle Systems to produce a computer and software tandem product.

NASDAQ

Oracle Systems rose 1 1/4 to 30 5/8.

The software company said it will revive an alliance with Digital Equipment to produce a computer and software tandem product.

AMEX

Interdigital rose 3/8 to 7 5/8.

The company won a $17.6 million order from Philippine Long Distance Telephone Co. for digital wireless local loop equipment and related services.

Intelcom fell 1 1/2 to 10 3/4.

The company said Thursday that its secondquarter loss will be larger than expected.