Stocks Resume Slide As Investor Jitters Return

Leading stock averages slipped Wednesday as investors, nervous about potential jolts from Friday’s inflation report, locked in some of the market’s modest rebound from its recent plunge.

In a mirror image of Tuesday’s lackluster session, the Dow Jones industrial average traded nearly unchanged until the final hour, but this time sank into the close, falling 45.32 to 6,563.84 and wiping out most of the prior day’s gain.

Broader stock measures turned mostly lower in the afternoon as technology shares, which have powered the market’s attempt to recover from a sell-off that sliced 630 points off the Dow, faltered after a four-session rally. Smaller company shares fared better than blue-chips.

“You’ve got people doing some selling because they got a bounce off the lows on many stocks,” said Barry Berman, head trader for Robert W. Baird & Co. in Milwaukee, noting that Friday’s reports on wholesale prices and retail sales activity have begun to loom over the market.

Advancing issues outnumbered decliners by a slim margin on the New York Stock Exchange, where volume totaled 451.49 million shares as of 4 p.m., almost even with the meandering pace of the previous two sessions.

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

NYSE

Merck, down 3-3/4 at 81-1/2.

Warner Lambert, up 1-1/4 at 94-3/4.

Merrill Lynch, Morgan Stanley, and Alex. Brown & Sons downgraded their investment ratings on Merck, the Dow Jones News Service reported. Alex. Brown also upgraded Warner Lambert, the news service said

Procter & Gamble, up 4 at 119-3/4.

Tambrands, up 2 at 48-1/8.

Cincinnati-based P&G, maker of Always sanitary pads, agreed to acquire Tampax tampon maker Tambrands for $1.85 billion, or $50 a share, in cash.

Dynamics Corp. of America, up 3-3/4 at 43-7/8.

WHX raised its bid for 17 percent of Dynamics to $29.2 million, or $45 a share.

Seagate Technology, down 1-7/8 at 49-3/8.

The maker of computer disk drives reported a better-than-expected profit for its third quarter ended March 28. Sales rose to $2.5 billion, up nearly 20 percent from the same period a year earlier.

NASDAQ

Stant, up 4-7/8 at 21-1/2.

Tomkins PLC of Britain agreed to buy the auto parts maker for $21.50 a share in cash in a deal valued at about $606 million, including the assumption of $200 million in debt.

Santa Cruz Operation, down 1-3/8 at 4-1/2.

The provider of Unix server and host software systems expects to report disappointing results for its second quarter ended March 31.