Market Stumbles, But Dow Manages New High
The Dow Jones industrial average clung to a small gain for its fourth record high in five sessions, but stocks retreated into Monday’s close as investors braced for today’s key economic data.
The Dow rose 7.67 to 8,121.11 after surrendering most of a nearly 65-point gain over the final hour of trading. But since the blue-chip barometer slipped just 3-1/2 points on Friday, the gain was enough for the Dow to beat Thursday’s record finish at 8,116.93.
The American Stock Exchange composite index also managed to set a new closing record, but several other broad-market indicators turned lower by the close after flirting with new highs. The Nasdaq market was weighed down by another weak showing among computer-maker stocks.
Stocks drew support throughout the session from the bond market, where interest rates sank to their lowest level of the year amid reports that the Clinton administration and congressional leaders were close to sealing a balanced budget agreement after months of haggling.
Although it’s a big week for economic news, there were no major reports scheduled for Monday, leaving investors to focus on today’s report on second-quarter employment costs and Friday’s reading on July job creation and wage levels.
Some of the stocks that moved substantially or traded heavily Monday:
NYSE
General Motors, up 1-5/8 at 58-1/2.
United Auto Workers approved a deal Sunday to end a six-day strike at a General Motors parts plant that forced four assembly plant shutdowns and threatened GM’s entire North American production.
Stampeder Exploration, up 7/8 at 4-15/16.
Gulf Canada Resources agreed to acquire the rival Canadian oil and gas company in a deal valued at $1 billion Canadian dollars, or about $722 million. Each Stampeder share is to be swapped for 0.69124 of a Gulf Canada share. Gulf Canada will also assume debt of $300 million Canadian dollars.
Freeport-McMoRan, up 4-9/16 at 31-1/8.
IMC Global, a major fertilizer producer, agreed to acquire its New Orleans-based rival for stock valued at about $800 million. IMC, based in Northbrook, Ill., is to issue 0.9 share of its stock for each share of Freeport, as well as a warrant to buy one-third of a share of IMC at a price equal to $44.50 a share up to three years after the merger.
Donna Karan International, up 1-5/16 at 11-3/4.
The design firm criticized for its lack of attention to the bottom line named John Idol, an executive with Polo Ralph Lauren Corp., as its chief executive. Donna Karan will still serve as chairman and chief designer.
NASDAQ
Dell Computer, down 2-5/8 at 78-7/8.
Bear Stearns analyst Andrew Neff lowered his rating on the computer maker to “attractive” from “buy,” citing the stock’s rapid rise, the Dow Jones News Service reported. It was the first day of trading for Dell after a planned 2-for-1 stock split.