Blue-Chip Sell-Off Halts Stock Market Advance

Stocks staged a broad retreat Wednesday as concerns about earnings of multi-national businesses triggered late selling of blue-chip stocks.

The Dow Jones industrial average, at one point up almost 58 points and above 8,000, ended the day down 18.90 at 7,957.41. The late decline, which came after gains throughout the day, halted two days of advances.

Broader market indicators also retreated.

Advancing issues outnumbered decliners by a 5-to-4 margin on the New York Stock Exchange, where volume was heavy at 618.9 million shares but below Tuesday’s 632.32 million.

Early in the day, the markets received a boost from Japanese Prime Minister Ryutaro Hashimoto’s surprise proposal for $15.38 billion in special income tax cuts. The announcement helped soothe worries over the effect of the Asian crisis on U.S. businesses.

“Japan took a positive stance last night to get their economy going again,” said John Lynch, director of investment strategy at Interstate/Johnson Lane in Charlotte, N.C. “It’s a step in the right direction.”

But word that the currency turmoil in Asia was expected to hurt a blue-chip U.S. company ultimately triggered the markets’ downturn.

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

NYSE

Minnesota Mining & Manufacturing Co., down 9 at 84-7/8.

3M estimated that the dollar’s strength would cut fourth-quarter earnings by 10 percent. The company is set to announce earnings of $375 million, or 90 cents a share, on Jan. 27.

AT&T, up 1 to 57-7/8.

Citicorp, up 2 to 131-1/2.

The nation’s largest credit-card issuer, Citicorp, is on the verge of adding AT&T Corp.’s Universal Card to its portfolio for a price of between $3 billion and $4 billion, The Wall Street Journal reported.

NextLevel Systems Inc., up 2-11/16, at 17-11/16.

The Hatboro, Pa.-based company agreed to supply about 15 million digital set-top boxes to nine cable operators in a deal it said is worth at least $4.5 billion over three to five years.

NASDAQ

Centocor Inc., down 6-3/8 to 31-1/2.

The drug research and development company fell on lower-than-expected earnings estimates. The company doesn’t expect to complete an international distribution agreement for Avakine, an antibody treatment for Crohn’s disease and rheumatoid arthritis, news reports said.

Jabil Circuit, up 4-3/8 to 41-1/2.

The circuit board maker’s president told CNBC that the Asian currency crisis could potentially cut revenue by only 2 percent, and could help the company by reducing local costs.