Profit Worries Block Dow In Latest Run At 8,000

The Dow Jones industrial average tried another casual jog above 8,000 on Wednesday, but tripped again as persistent earnings worries overshadowed another improvement in interest rates.

For the fourth time in five sessions, the Dow turned lower almost as soon as it had bobbed above 8,000, surrendering an early 65-point gain and falling 63.35 to close at 7,906.71.

Broader stock indicators also gave back some sizable gains despite a drop in interest rates in the bond market, which resumed a rally after a one-day stumble.

The downturn derailed an eight-session streak of record highs by the Russell 2000 index of smaller companies and a four-session streak by the Nasdaq composite index.

Although no major companies issued warnings Wednesday of disappointing profits, investors remain too jittery about third-quarter reports - not due for several weeks - to bid the blue-chip sector back to record levels, analysts said.

“The bond market has rallied, but the second part of the equation is corporate profits. And when there’s a little fear that they will fall shy (of Wall Street forecasts), it’s a little tough to mount anything sustainable,” said Tony Dwyer, chief market strategist at Ladenburg Thalmann & Co., calling the concerns overblown. “Fear is often worse than reality, and I think that will be the case here.”

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

NYSE

Salomon, up 4-3/4 at 76-1/4.

Travelers Group, down 2-5/8 at 69-7/16.

Salomon agreed to be acquired by Travelers for stock valued at about $81 a share, or more than $9 billion. Travelers will merge Salomon with its Smith Barney brokerage division to create Salomon Smith Barney.

Avis Rent A Car, up at 22-1/2 from initial offering at 17.

HFS of Parsippany, N.J., sold 19.5 million shares of the auto rental company for $331.5 million, or $17 each, in an initial public offering. Avis, based in Garden City, N.Y., had expected the shares to sell for between $15 to $17.

Unisys, up 5/16 at 12-7/16.

The computer services company on Tuesday hired Lawrence A. Weinbach, credited with broadening accounting firm Arthur Andersen into a worldwide consulting company, to be chairman, chief executive and president.

NASDAQ

Oracle, up 11/16 at 38-1/16.

The stock rose amid enthusiasm over a presentation to Wall Street analysts by the software company at a conference on Tuesday, the Dow Jones News Service reported.

Camelot, up 2-7/16 at 5-27/32.

The Dallas-based company is in talks to license its Internet videoconferencing technology to personal computer makers for inclusion in 1998 products.