Profit Worries Undermine High-Tech Stocks
Technology shares slid again as worries about computer-industry profits intensified Thursday. Blue-chip issues fared better, but stocks continued to flounder amid the persistent worries about inflation and interest rates.
The Dow Jones industrial average rose 11.08 points to close at 5,659.43 after giving back an early gain of 31 points and recovering from an afternoon slide of 15.
Broader measures of blue chips and other large companies also finished near their opening levels, but the Nasdaq market fell sharply as investors continued to lock in profits from this spring’s powerful rally in technology and more-speculative shares.
Trading was mostly quiet and indecisive again, although volume picked up considerably as traders positioned themselves for today’s expirations of options contracts to buy and sell stocks and stock-related securities at specific prices.
Declining issues outnumbered advancers by a 5-to-3 margin on the New York Stock Exchange, where volume totaled 439.29 million shares as of 4 p.m., up from Wednesday’s 375.29 million.
Some of the stocks that moved substantially or traded heavily Thursday:
NYSE
Westinghouse Electric, down 3/4 at 18-1/8.
Infinity Broadcasting Class A, up 1/2 at 29-1/8.
Westinghouse announced plans to buy Infinity for $3.9 billion in stock, bringing together the two biggest players in the radio-station business.
El Paso Energy, up 3-1/8 at 37-1/2.
Tenneco, down 5/8 at 53-7/8.
El Paso Energy is acquiring Tenneco’s energy division in a $4 billion deal. The sale, announced Wednesday evening, marks the third time in the past 15 months Tenneco has sold or spun off a major division under its effort to focus on auto parts and packaging.
National Semiconductor, up 7/8 at 16-1/4.
The chip maker formed a new division from the assets of the former Fairchild Semiconductor with plans to spin it off as an independent company again. The move resurrects a historic name in Silicon Valley.
NASDAQ
MCI Communications, down 3/8 at 25-1/2.
The company received approval to offer local telephone service in New Jersey. The long-distance phone service carrier expects to enter the local market later in the year.
Telxon, down 4-5/8 at 9-7/8.
The manufacturer of wireless and portable teletransaction systems said Wednesday evening it expects to report a loss of about 50 cents a share for the first half of fiscal 1997.
New Paradigm Software, up 3/8 at 2-7/8.
Transquest Information Solutions, a joint venture between Delta Air Lines and AT&T, has signed a licensing deal to use the company’s Copernicus product.