Dow Overcomes Early Loss To Hit New High

Blue-chip stocks rose to their third consecutive record high Friday as investors brushed off a drop in bond prices that resulted from continued budget discord in Washington.

Broad market indexes ended mostly lower following a mixed performance by technology issues as investors sold to cash in some of the best performers’ recent sharp gains.

The Dow Jones industrials overcame a 24-point loss to end 6.14 higher at 4,870.37, topping record sessions on Wednesday and Thursday and ending the week with a 44.80-point gain. But declining issues led advancers by about 5 to 4 on the New York Stock Exchange. Big Board volume was weaker than it has been in some time, at 297.95 million shares as of 4 p.m., down from 379 million on Thursday.

The budget deadlock between Congress and the Clinton administration kept some investors on the sidelines.

“The stock market, above all, hates uncertainty,” said Cummins Catherwood, managing partner at Rutherford, Brown & Catherwood in Philadelphia. The budget impasse “creates a diminution in confidence, often results in contraction of price-earnings ratios (as interest rates rise), because you don’t know what the heck is coming.”

Stock prices would certainly suffer if the budget impasse is not ended soon, and with a budget that meaningfully reduces the nation’s deficit, analysts said.

Some of the stocks that moved substantially Friday:

NYSE

KMart fell 3/8 to 7-1/2.

Duff & Phelps downgraded $2 billion of the company’s long-term senior debt to BBB-Minus from BBB. The company’s stock has been falling because of market concerns about $681 million in real estate debt, which has a provision allowing investors to sell them if the company’s credit rating falls below investment grade.

Amre Inc. rose 1-1/4 to 10-1/4.

Shares of the Dallas maker of home-improvement products rose after the conclusion of a sale of 10.8 percent stake by Steven D. Bedowitz, an Amre founder and former company officer.

Marvel Entertainment fell 2-1/8 to 11-3/4.

Third-quarter earnings at the New York City company fell to 19 cents per share from 22 cents a year ago. The company blamed soft sales of trading cards and comic books.

NASDAQ

American Greetings fell 3-7/8 to 27.

The Cleveland company said third-quarter net earnings will be reduced by about 47 cents per share by the write-down of some assets of its struggling CreataCard business. Last year in the third quarter, the company earned $58.9 million, or 79 cents a share.

Cisco Systems, rose 1-1/4 to 87-1/8.

First-quarter net earnings rose to 59 cents per share, up from 37 cents a year ago. The San Jose, Calif., company, which makes computer networking equipment, attributed the strength to a new business strategy, key product introductions and acquisitions.

U.S. Robotics, rose 4 to 103-1/4.

The Skokie, Ill., company reported fourth-quarter earnings of 75 cents a share, above estimates of 63 cents, and gave an optimistic assessment of future business. The company makes modems and communications products for companies such as those that provide Internet access.