Dow Reaches Record High In Volatile Session

The Dow industrials returned to record territory Tuesday, led by technology and consumer-related shares, after another volatile session.

The Dow Jones industrial average ended up 42.27 at 5,642.42, topping a record high of 5,630.49 set on Feb. 23.

The blue-chip index was lower throughout the morning but bounced into positive territory shortly before 1 p.m. The Dow backed off a second time before shooting higher in the final 30 minutes of trading on the strength of computer-driven buy programs, traders said.

Advancing issues pulled slightly ahead of decliners at the end of the session after trailing them all day. Volume on the floor of the Big Board was heavy at a revised 435.28 million shares as of 4 p.m., up from Monday’s pace.

Thom Brown, a market strategist and principal at Rutherford, Brown & Catherwood in Philadelphia, said the gains in stocks were “pretty remarkable,” considering the weakness in the bond market Tuesday.

Stocks also rose on the strength of continued cash flows into stock mutual funds, Brown said, and on economic data that showed “the economy was not slowing as much as people had thought. People like to buy consumer stocks in that situation, and they have a lot of money to spend.”

Some of the stocks that moved substantially Tuesday:

NYSE

BankAmerica Corp. rose 2 to 77-1/2.

The San Francisco company said it may buy back up to $2 billion of its common stock and may buy back or redeem up to $1 billion of its preferred stock by the end of 1997. BankAmerica said the new program wholly replaces a stock buyback announced last February.

NASDAQ

Amgen rose 2-7/8 to 64-1/8.

Morgan Stanley upgraded the stock to a strong buy from an outperform.

NABI rose 1-1/8 to 13.

Donaldson, Lufkin & Jenrette Securities upgraded the stock to buy from outperform.

Netscape fell 1-5/8 to 50-1/8.

The company said it will cut the price of its Internet server software in response to Microsoft’s decision to give away a rival product.

AMEX

AMC Intertainment rose 1-1/8 to 22-3/4.

Bear Stearns & Co. upgraded the stock to buy from attractive, calling the movie exhibitor a “category killer or specialty retailer” within its business. Bear Stearns also said AMC is positioned to profit from the overseas box-office business, because of the company’s plans to open a movie house in Japan next month.