Blue-Chip Rally Halts Dow’s Slump

Blue-chip stocks recovered some ground Thursday as bargain hunters focused on battered technology names and old favorites like AT&T, IBM and GE. A broad rebound faltered, however, with few issues resolved in the overseas financial crisis.

The Dow Jones industrial average rose 86.44 to 7,487.76 after swinging from an early 87-point gain to a 51-point loss.

Broader stock measures finished mixed after a similar series of twists and turns. Declining stocks outnumbered advancers by a slim margin on all major exchanges, with small-company shares failing to mount a full recovery from a midday slide.

While analysts tied the market’s early gains to some hints of calm on overseas markets, there were few specific developments to explain the market’s mood swings later in the day.

“What the market’s doing here is very normal in terms of behavior after a sharp market drop,” said William Dodge, portfolio manager at Marvin & Palmer Associates of Wilmington, Del.

“There are unlikely to be serious enough issues here that cause us to violate the recent lows,” said Dodge referring to the Dow’s brief trip below 7,000 on Oct. 28, a day after its record-setting 554-point plunge. “But the kind of damage that was done weeks ago requires a period of digestion and repair.”

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

NYSE

Metro-Goldwyn-Mayer, up at 21 from IPO at 20.

The venerable movie studio sold 9 million common shares for $20 each in an initial public offering.

CIT Group, up at 30 from IPO at 27.

The New York-based financial services company sold 31.5 million shares for $27 each in an initial public offering.

NASDAQ

Osicom Technologies, up 1/2 at 2-9/16.

The wireless networking concern said late Wednesday it plans to buy back its stock, citing current price levels and strong prospects for the company’s results. Osicom is based in Santa Monica, Calif.

Virus Research Institute, down 3-1/2 at 5-3/8.

The Cambridge, Mass.-based company reported that the latest clinical trial with its Adjumer influenza vaccine showed less improvement in patients than an earlier study.

Citrix Systems, up 2-3/8 at 71-15/16.

The Fort Lauderdale, Fla.-based software company announced late Wednesday that the class-action securities suits filed against it the spring were voluntarily dismissed by the plaintiffs.