Market Turns Pessimistic About Earnings

Technology stocks undermined the stock market again Monday as mounting fears about corporate earnings clouded a quiet holiday session.

With the bond market, banks and most government offices closed for the observance of Martin Luther King Jr.’s birthday, investors had little to focus on but worries about the impending slew of earnings reports.

The Dow Jones industrial finished at 5,043.78, down 17.34. Declining issues outnumbered advancers by about 4 to 3 on the New York Stock Exchange, where holiday volume totaled 305.79 million shares as of 4 p.m., down from 376.81 million on Friday.

Technology stocks, which stumbled badly last week, continued to undermine the broader market. The technology-heavy Nasdaq composite index lost 19.66 points.

Some of the stocks that moved substantially or traded heavily:

NYSE

Archer-Daniels-Midland, down 1/4 to 17.

The food conglomerate reported a profit of 43 cents a share for the last quarter of 1995, slightly higher than a year earlier.

Kmart, down 1/2 to 6-1/2.

The troubled retailer’s bond rating was downgraded Friday to junk status by Standard & Poor’s.

Merck, up 1-1/2 to 63-5/8

Johnson & Johnson, up 7/8 to 86-5/8

Pharmacia Upjohn, up 1/2 to 37-1/2

Big drugmakers, considered more reliable in a weak market, moved.

Federal Express, down 3-1/4 to 69-3/4.

The shipping concern announced late Friday that operating profits for its current quarter will fall “significantly below” Wall Street estimates due to severe winter weather.

IBM, down 3 to 83-3/8.

Texas Instruments, down 2-3/4 to 43.

Micron Technology, down 2-1/8 to 30-7/8.

Motorola, down 1 to 48-3/8.

Compaq Computer, down 2 to 44.

Investors remained skittish about the technology sector as bellwethers such as IBM prepared to report on profits for the last three months of 1995. Last week, Motorola posted a surprising 16 percent decline in fourth-quarter profits.

NASDAQ

Intel, down 3-1/4 at 53-3/8.

Sun Microsystems, down 2-1/4 to 37-7/8.

Microsoft, down 3-1/4 to 82-1/2.

Intel and Sun Microsystems are slated to report earnings today.

General Acceptance, down 5 to 7.

William Blair & Co. became the latest investment firm to downgrade its earnings outlook for the company, which buys auto loans from car dealers.