Profit-Taking Snaps Dow’s Climb

The late-blooming recovery of smaller-company shares pushed some stock indexes to new highs Wednesday, but mild profit-taking halted the blue-chip sector record-setting advance.

The Dow Jones industrial average fell 26.18 to 7,357.23, trimming a 75-point deficit over the final half hour. The blue-chip barometer had managed to erase an early 32-point slide, but quickly faltered around midday as it entered record territory for the third straight session.

Several big-name technology shares struggled with the blue-chip sector, but analysts found little reason to suspect a impending pullback from the market’s recent exploits.

“I’m amazed there hasn’t been more selling considering the rally since April,” said Richard A. Dickson, a technical analyst at Scott & Stringfellow Inc. in Richmond, Va.

Advancing issues outnumbered decliners by a 10-to-9 margin on the New York Stock Exchange, where volume totaled 487.18 million shares as of 4 p.m., up from 435.95 million in the previous session.

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

NYSE

CUC International, down 1-3/4 at 23-1/4.

HFS, down 4-1/4 at 54-3/4.

CUC, a provider of telephone shopping services, agreed to acquire HFS for stock initially valued at $10.9 billion, or about $60 a share.

Bay Networks, up 2-1/2 at 25-1/4.

SoundView Financial Group raised its short-term rating on the maker of communications-networking equipment, the Dow Jones News Service reported, citing market contacts.

Charles Schwab, up 2-7/8 at 38-3/4.

The discount broker was named to replace Morgan Stanley Group in the Standard & Poor’s 500 due to Morgan Stanley’s pending merger with Dean Witter, Discover.

Nike, up 3-7/8 at 64.

The shares rose amid speculation that billionaire investor Warren Buffett was buying a stake in the athletic footwear and apparel giant, the Dow Jones News Service reported.

NASDAQ

CommNet Cellular, up 4-13/16 at 34-3/8.

The Blackstone Group, a New York-based investment bank, agreed to acquire the cellular service provider for $718 million, or $36 a share.

AMEX

Fibreboard, up 6-13/16 at 54-5/16.

Building materials manufacturer Owens Corning agreed to acquire the vinyl siding maker for about $600 million in cash and assumed debt. Owens Corning, based in Toledo, Ohio, will pay $55 for each share of Dallas-based Fibreboard and assume $85 million in Fibreboard debt.