Early Gains Vanish As Investors Collect Profits

Stocks gave up early gains Tuesday as investors sought profits in a late sell-off of technology and cyclical issues that had been supported by mostly positive economic reports.

The Dow Jones industrial average ended down 1.09 to 4,755.48. At one point, the stock market’s best-known index was up as much as 42 points.

By day’s end, most broad market indexes had fallen and declining issues led advancers by about 10 to 9 on the New York Stock Exchange. Volume on the Big Board was moderately heavy at 375.70 million shares vs. 318.84 million on Monday.

The session surged after the opening bell, extending Monday’s gains and benefiting from Quebec’s rejection of a proposal to split from Canada. It was feared that a ‘yes’ vote would jolt financial markets.

In the afternoon session, the Dow average nudged above 4,800 and was approaching the alltime high of 4,802.45 set on Oct. 19. Analysts said that was the signal for investors to sell. With many portfolio managers closing out their books for the fiscal year, it was a good opportunity to take advantage of share prices that moved up for three consecutive sessions.

“We got just over 4,800, so everyone figured why not take some profits,” said Alfred E. Goldman, vice president, A.G. Edwards & Sons Inc. in St. Louis. “There was overdue profit-taking on technology stocks and on the investment du jour - economically-sensitive issues.”

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

NYSE

Champion International Corp., up 1/4 to 53-1/2. The paper company was the subject of an upbeat front page story in the Wall Street Journal that said 1995 earnings per share could surge 66 percent.

Dow Chemical, down 1-1/4 to 68-5/8. The chemical maker was fined $10 million by a Nevada jury in a breast implant injury suit.

Ford Motor Co. down 7/8 at 28-3/4. A jury ordered Ford Motor Co. to pay $62.4 million to two women injured in a Bronco accident blamed on faulty design.

Kmart, down 7/8 to 8-1/8. The retailers’ shares skidded as the company sought to reassure investors that it has strong liquidity.

US West, up 1 to 47-7/8. Shareholders approved a plan to split the company’s stock into two classes.

NASDAQ

Novell Inc., up 1/8 at 16-1/2. The company is holding discussions with parties interested in buying its WordPerfect software business.

AMEX

Cheyenne Software Inc., up 3/4 at 20-3/4. The company will acquire assets of Media Blitz Inc., a California company that makes optical storage and CD-ROM products.