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Volume Slows, but Market Rebounds; Dow Adds 9.90

May 22, 1987|From Times Wire Services

NEW YORK — The stock market managed to post a moderate gain Thursday, rebounding from a weeklong slide.

But prices finished well below their mid-session peaks as interest rates, which started off the day with a solid drop, inched up again.

The Dow Jones average of 30 industrials, which had fallen nearly 110 in the past four sessions, recovered 9.90 to 2,225.77.

Volume on the New York Stock Exchange slowed to 164.83 million shares from 206.83 million Wednesday.

Analysts noted that traders began to step up their buying Wednesday when the Dow Jones industrial average briefly dipped below 2,200.

The belief that stocks were due for a rally got some support Thursday, when interest rates turned downward in the credit markets.

But as the improvement in the bond market faded, so did the upswing in stocks. Analysts also noted that the rally came on less-than-impressive volume.

Many Wall Streeters took a positive view of Citicorp's decision this week to increase by $3 billion its reserves against loans to lesser-developed countries.

Though it means a large loss for Citicorp in the current quarter, the action is seen as strengthening the bank holding company's long-term position.

Citicorp shares led the active list, up 2 3/4 at 55 7/8 on turnover of more than 2.8 million shares.

Elsewhere in the bank group, J. P. Morgan picked up 2 to 44; Chase Manhattan gained 1 5/8 to 36 1/2; Chemical New York rose 1 1/2 to 41 1/8, and Manufacturers Hanover jumped 1 to 39 1/2.

Among blue chip industrials, Ford Motor rose 1 to 88 7/8; General Electric gained 3/4 to 100 3/4; International Business Machines picked up 5/8 to 157, and American Express climbed 1 to 33.

Burlington Industries jumped 2 7/8 to 75 1/8. The company agreed to be bought out by an investor group for $76 a share.

In the bond market, prices ended slightly higher in part because of a more stable dollar and a drop in some commodity prices.

The Treasury's 30-year bond, which gained about point, or $2.50 per $1,000 face amount on Wednesday, was up 1/16 point. Its yield dipped to 9.04% from 9.05%.

Most corporate issues posted gains while municipal bonds were mixed.

In the secondary market for Treasury bonds, prices of short-term governments were up 1/16 point, intermediate maturities ranged from 1/8 point to 3/16 point higher and 20-year issues rose 1/8 point, according to Telerate Inc.

The federal funds rate, the interest on overnight loans between banks, traded at 6.75%, unchanged from Wednesday.

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