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Stocks Decline in Quiet Session; Dow Off 7.57

January 21, 1986|From Times Wire Services

NEW YORK — Monday was a federal holiday marking the birthday of Martin Luther King Jr. Banks and government offices were closed. In consequence, there are no tables for foreign currency or government bonds. The weekly Treasury bill auction was postponed until today.

Stock prices closed lower in a subdued session Monday as many traders were absent on the holiday honoring Martin Luther King Jr.

The Dow Jones average of 30 industrials opened sharply lower amid pessimism about the interest-rate outlook and lingering disappointment over the financial results reported Friday by International Business Machines.

Some buying in the final hour helped blue chips trim the losses, and the Dow industrials closed at 1,529.13, down 7.57.

Losers outnumbered gainers by a margin of three to two on the New York Stock Exchange. Volume on the Big Board contracted to 85.34 million shares from 132.13 million on Friday.

A weekend meeting of government officials from five major industrial countries did not yield a concerted commitment to bring interest rates down.

Finance leaders and central bank governors from the United States, Britain, France, Japan and West Germany met in London to review a Sept. 22 accord under which they joined to drive down the dollar's value. Last week, speculation that the countries might take a similar approach dealing with interest rates touched off rallies in the stock and bond markets.

At the conclusion of the London talks, the five countries issued a statement saying they agreed that their cooperation on the dollar should continue and that the progress that had been made should not be reversed. But the statement did not make any mention of an interest-rate strategy.

Merrill Lynch, recently the subject of takeover rumors, led the list of actively traded stocks most of the afternoon and closed up 1 5/8 at 40.

Eastern Airlines slipped 1/8 to 5 1/8 in heavy trading. The airline said Monday that it will lay off 1,010 of its 7,000 flight attendants and will institute further pay cuts in a bid to cut costs and preserve much-needed financing.

Federated fell 7/8 to 68 5/8. The company announced a restructuring plan and said the move will require a $25-million charge against after-tax earnings in the fourth quarter and could cut income during the first half of fiscal 1986.

IBM, which tumbled 5 1/8 to 150 7/8 on Friday, dropped an additional 1 1/2 to 149 3/8 in heavy trading. IBM on Friday reported its fourth-quarter and 1985 financial results that fell short of some Wall Streeters' optimistic expectations.

Oil stocks traded heavily as prices for crude oil, gasoline and home- heating oil plunged again in the futures market, reflecting an abundance of world supplies and mild weather.

Exxon fell to 52, Mesa Petroleum 1/8 to 2 5/8 and Occidental Petroleum to 28 3/4. However, Mobil rose 1/8 to 30 3/8.

Nationwide turnover in NYSE-listed issues, including trades in those stocks on regional exchanges and in the over-the-counter market, totaled 103.71 million shares.

The NYSE index of all its listed common stocks declined 0.48 to 119.86.

Large blocks of 10,000 or more shares traded on the NYSE totaled 1,578, compared to 2,654 on Friday.

The Wilshire index of 5,000 equities closed at 2,143.683, down 8.802.

Standard & Poor's index of 400 industrials dipped 1.05 to 229.79, and S&P's 500-stock composite index was off 0.90 to 207.53.

The NASDAQ composite index for the over-the-counter market fell 1.21 to 329.51.

At the American Stock Exchange, the market value index closed at 246.16, off 1.52.

In the bond market, corporate and municipal bond prices made minor movements in light activity.

Corporate bond prices held steady at Friday's levels.

In the tax-exempt municipal bond market, revenue bonds and general obligations were also largely unchanged.

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