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Stocks Close Mixed as Bond Prices Advance

January 15, 1986|From Times Wire Services

NEW YORK — The stock market turned in a mixed performance Tuesday as the blue chips encountered renewed pressure while bond prices staged a modest recovery as traders played down the significance of the latest economic news.

After spurting ahead about 6 points in the first hour of trading, the Dow Jones average of 30 industrials lost ground and spent the rest of the day drifting in negative territory.

A late buying wave lifted the Dow above the low levels of the session, and it closed off 1.49 at 1,519.04.

But, in the broader market, gainers outnumbered losers by about nine to six on the New York Stock Exchange.

Volume on the Big Board came to 113.92 million shares, compared to 108.68 million on Monday.

Bernadette Murphy, senior vice president of Shaw & Co., said the stock market is still reeling from the shock of last week's massive decline. She said Tuesday represented a "continuation of the downward trend" that began last week when the Dow industrials lost 35.67 points.

In the latest news on the economy, the Commerce Department reported that retail sales rose 1.9% last month, the biggest gain since September.

Some technology issues received support Tuesday from a prediction by the semiconductor industry that it expects this year to be significantly better than 1985. One example, Texas Instruments, closed up 2 1/8 at 105 1/8.

Industry leader International Business Machines rose to 149 and was among the most actively traded issues on the Big Board.

Food stocks benefited from an announcement Monday that government price supports for wheat and corn are being sharply reduced. Archer Daniels Midland, also among the most actively traded, gained 1 1/8 to 27 3/4.

Eric Larson, an investment analyst with Paine Webber, said the cuts in farm subsidies will enhance the profit margins of food processors because the firms will be able to buy grains at lower costs but keep their retail prices the same.

At the close, International Harvester led the active list. The company, which plans to change its name to Navistar International, rose 3/8 to 9 3/8.

Other actively traded issues included Ala Moana Hawaii, up to 2; Phillips Petroleum, down 1/2 to 12 1/8; Eastman Kodak, unchanged at 48 1/8, and CSX, down at 31 7/8.

Standard & Poor's index of 400 industrials fell 0.14 to 229.22, and S&P's 500-stock composite index was off 0.08 at 206.64.

In the credit markets, short-term interest rates hovered near recent levels while rates on longer maturities fell slightly.

In the secondary market for Treasury securities, prices of short-term governments were up 1/16 point to 1/8 point, intermediate maturities moved up 1/8 point to 5/16 point and long-term issues rose nearly 1/2 point.

The Merrill Lynch daily Treasury index, which measures price movements on all outstanding Treasury issues with maturities of a year or longer, rose 0.26 from late Monday to 109.32. The Shearson Lehman daily Treasury bond index, which makes a similar measurement, went up 2.57 to 1,147.47.

The federal funds rate--the interest on overnight loans between banks--traded at 7.875%, down from 8% late Monday.

In corporate trading, industrials and utilities rose 1/2 point in moderate trading.

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