NEW YORK — The stock market emerged from a quiet, drifting session Thursday clinging to a small gain.
The Dow Jones average of 30 industrials, up 1.23 points on Wednesday, rose another 1.35 to 1,328.07.
Volume on the New York Stock Exchange slowed to 90.91 million shares from 99.14 million the day before.
The market's advance Wednesday was sparked by heated takeover speculation in many issues.
But analysts said that kind of trading enthusiasm couldn't be sustained for very long. As it faded, they said, stock prices gave way to continuing concerns about the outlook for the economy, corporate earnings and interest rates.
Brokers said the market might take its next cue from International Business Machines' impending third-quarter earnings report. In Thursday's trading, IBM shares rose 1/8 to 124 3/8.
Beatrice, a prime target of takeover speculators in recent sessions, dropped back 2 1/2 to 41.
Semiconductor Issues Off
Some semiconductor and other technology issues declined amid concern about earnings prospects in that sector of the economy. Motorola fell 1 to 30, Hewlett-Packard 1/2 to 29 and National Semiconductor 3/8 to 11.
Ford Motor gained 3/4 to 45 1/2. The company raised its quarterly dividend to 70 cents a share from 60 cents.
Retailing issues were mixed as major companies in the industry posted generally soft sales results for September. Sears, Roebuck dropped 3/8 to 31 3/4, K mart 3/8 to 31 3/8 and J. C. Penney 7/8 to 46 3/4.
Middle South Utilities climbed 1 3/8 to 10. A judge ordered an immediate rate increase for MSU's Louisiana Power & Light subsidiary, which has been in financial difficulties relating to a nuclear power project.
Bank stocks were mostly higher as the first of the third-quarter earnings reports in the industry generally showed healthy gains. Citicorp rose 3/4 to 43, Chase Manhattan 7/8 to 53, J. P. Morgan 3/4 to 49 and Manufacturers Hanover 3/8 to 36.
In the daily tally on the Big Board, about five issues rose in price for every four that lost ground. The exchange's composite index of all its listed common stocks gained 0.21 to 105.75.
Nationwide turnover in NYSE-listed issues, including trades in those stocks on regional exchanges and in the over-the-counter market, came to 107.68 million shares.
Large blocks of 10,000 or more shares traded on the NYSE totaled 1,798, compared to 2,135.
Standard & Poor's index of 400 industrials rose 0.13 to 203.95, and S&P's 500-stock composite index was up 0.26 at 182.78.
The Wilshire index of 5,000 equities closed at 1,877.889, up 4.439.
The NASDAQ composite index for the over-the-counter market added 1.13 to 279.41. At the American Stock Exchange, the market-value index closed at 221.98, up 0.59.
Bond Prices Mixed
Bond prices finished narrowly mixed as market participants awaited congressional action to raise the federal debt ceiling.
The federal government has been effectively blocked for weeks from issuing new bonds and notes because the federal debt load is near the legal limit.
The Treasury postponed an auction of notes and bonds in late September that had been expected to amount to about $17.5 billion because the sale would have pushed the federal debt over the legal limit.
Once Congress passes legislation raising the debt ceiling, analysts expect the Treasury will bring about $50 billion in notes and bonds to markets within a few weeks, an exceptionally heavy load.
Bond prices slipped momentarily but then rebounded late in the session after the Federal Reserve Board reported that the nation's basic money supply jumped by $5.3 billion in late September.
The surge was larger than expected and left money growth far above the targets which the Fed has set to assure steady, non-inflationary economic growth.
But many analysts say that the central bank is focusing on the economy and that the Fed probably won't tighten credit conditions because of its agreement with four of its major trading partners to reduce the value of the dollar.
In the secondary market for Treasury bonds, prices of short-term governments were unchanged, intermediate maturities were mixed with some off 1/32 point and others up 1/8 point and long-term issues were up point, according to the investment firm of Salomon Bros. The movement of a full point is equivalent to a change of $10 in the price of a bond with a $1,000 face value.
The Merrill Lynch daily Treasury index, which measures price movements on all outstanding Treasury issues with maturities of a year or longer, rose 0.06 to 105.66 from Wednesday's close. The Shearson Lehman Treasury bond index, which makes a similar measurement, rose 0.59 to 1,109.07.
Salomon Bros. said that, in corporate trading, industrials and utilities were up point in light to moderate activity.
Among tax-exempt municipal bonds, the investment firm said general obligations and revenue bonds rose point in moderate activity.
Yields on three-month Treasury bills, meanwhile, rose 5 basis points to 7.24%. A basis point is one-hundredth of a percentage point. Six-month bills were up 2 basis points at 7.38%, and one-year bills were up 2 basis points at 7.49%.