NEW YORK — Stock prices finished mixed amid jittery waves of trading Friday as Wall Street awaited, received and began scrutinizing a long-awaited new plan to help cut the federal budget deficit.
The Dow Jones industrial index, down more than 30 points in early trading, closed 18.24 points higher at 1,913.63, cutting its loss for the week to 21.38 points.
Broader market indexes moved higher, although decliners outnumbered advancers on the New York Stock Exchange by about 8 to 7, with 705 up, 828 down and 421 unchanged.
Big Board volume totaled 189.17 million shares, against 157.14 million in the previous session.
The market rallied to its best levels of the day near the close when President Reagan and congressional leaders announced a plan to trim the federal budget deficit by about $30 billion in the current fiscal year and $45 billion next year.
Wall Street all week had focused almost almost exclusively on the Washington budget talks, which faced a deadline of Friday, when $23 billion in spending cuts took effect automatically under the Gramm-Rudman budget law. The proposal announced Friday will supplant those cuts if it is completed.
Concern Over Leadership
The lack of an agreement Thursday after more than a month of haggling and recent signs that the talks might break down completely had prompted foreign markets to pressure stocks lower in overnight trading.
Inability to reach a deficit-cutting agreement was seen widely in U.S. and foreign markets as reflecting a lack of government leadership in addressing a problem regarded as a key factor in the market's Oct. 19 crash.
In Tokyo, stocks rebounded in a late rally, with the Nikkei 225-stock index gaining 36.76 points to close at 22,705.56.
London stocks rallied late in the session. The Financial Times-Stock Exchange 100-share index, which had been off as much as 33.2 points during the day, closed at 1,633.4, down 5.7 points.
Stocks fell sharply at Friday's opening in the United States but rebounded amid a stream of sometimes conflicting reports that an agreement had been reached and was on its way to the White House.
Blue Chips Volatile
Activity in the blue chip issues was especially volatile, with the Dow industrials swinging through a nearly 50-point range during the day and moving up or down in response to the latest reports from Washington.
Reaction to the final agreement was relatively muted on Wall Street, with many traders wanting time to scrutinize specific terms and to await the reaction in foreign markets and the full Congress.
"It isn't that the package is so terrific, but foreign investors want to see some leadership," said Larry Wachtel, a market analyst for Prudential-Bache Securities. "Now the question is: Can they get this plan through Congress?"
Among active blue chips, General Electric rose 7/8 to 45, IBM gained 2 1/8 to 117 3/4, Exxon climbed 7/8 to 40 and AT&T finished unchanged at 28.
Takeover-related issues were active. Bell & Howell, whose management is negotiating a leveraged buyout with an investor group led by Robert Bass, rose 1 7/8 to 67, on top of a 5-point gain Thursday.
Singer, which faces a $50-a-share hostile takeover offer from investor Paul Bilzerian, rose 4 1/2 to 53 3/4 after announcing that it was holding preliminary merger talks with other companies.
Irving Bank rose 2 1/8 to 50 7/8. Bank of New York revised its previous buyout offer for Irving to reduce the cash portion of its bid while increasing the number of shares that Irving stockholders would receive.
Nationwide turnover in NYSE-listed issues, including trades in those stocks on regional exchanges and in the over-the-counter market, came to 213.02 million shares.
Large blocks of 10,000 or more shares traded on the NYSE totaled 3,320, compared to 3,066 on Thursday.
The NYSE composite index of all its listed issues was up 0.84 to 135.56.
Standard & Poor's index of 400 industrials rose 2.51 to 276.81, and S&P's 500-stock composite index was up 1.95 to 242.00.
At the American Stock Exchange, the market-value index rose 0.82 to 242.58.