The U.S. stock market turned in a mixed pre-Thanksgiving performance Wednesday, with recently red-hot blue-chip shares taking a break while many smaller issues gained.
The Dow Jones industrial average lost 29.07 points to 6,499.34, adding to Tuesday's drop of 19.38 points.
But the market overall was mostly higher. Winners topped losers 1,343 to 1,136 on the New York Stock Exchange and 2,065 to 1,853 on Nasdaq.
Some analysts said the broad market's ability to advance in the face of profit taking in the Dow stocks was a healthy sign, given that the rally of recent weeks was so focused on the Dow.
"This is a sign we could see some broadening" in the rally, said James Margard, a fund manager at Rainier Investment Management, with $3.1 billion in assets.
The Russell 2,000 index of smaller stocks, which has badly lagged the Dow over the last few months, added 1.29 points to 352.67.
The Nasdaq composite index, which is heavily weighted with technology issues, rose 6.12 points to a record 1,287.32.
"We're not having any trouble finding value in small issues," said Porter Sutro, a money manager at Axe-Houghton Associates, which oversees $4.1 billion.
Whether other investors feel the same in coming weeks will determine whether stocks' advance can continue, if blue-chip shares continue to stall out.
Markets are closed today for Thanksgiving but will reopen Friday.
The next move in bond yields will also loom large for stocks, since falling yields in recent months have helped power Wall Street's gains.
On Wednesday, bond yields fell in early trading, then closed just slightly lower, as some traders expressed concern that the latest U.S. economic data is pointing to unexpected strength--which could boost interest rates again.
The bellwether 30-year Treasury bond yield ended at 6.42%, down from 6.44% on Tuesday but up from an eight-month low of 6.38% during trading.
The Commerce Department reported that orders for big-ticket products unexpectedly edged up 0.1% in October. Meanwhile, a University of Michigan report said consumer sentiment is improving going into the holiday selling season, and a survey of Midwestern factory managers suggested increasing manufacturing activity.
"Investors are going to be hard-pressed to expect further decreases in yield--I just don't see the case for it," said Jeffrey Eglow, a money manager at Highlander Capital Management in Parsippany, N.J. "We still think that the economy is growing."
The stock market, of course, wants growth--but only at a pace moderate enough to keep interest rates and inflation subdued.
Among Wednesday's highlights:
* The Dow was weighed down by its three oil stocks, which dropped on worries that the potential return of Iraqi crude to the world supply will lower oil prices. On Monday, Iraq accepted the remaining United Nations conditions for implementation of an oil-for-food plan.
Within the Dow, Texaco lost 1 5/8 to 98 7/8, Exxon dropped 1 1/8 to 93 3/4 and Chevron was off 1 1/2 to 66 5/8.
But in New York futures trading, January oil futures added 13 cents to $23.75 a barrel.
* Disney also hurt the Dow, losing 2 1/8 to 73 7/8 after rallying to record highs in recent days. And Philip Morris eased 7/8 to 103 7/8 after it and other tobacco companies lost an appeal to the Minnesota Supreme Court, forcing them to disclose unedited cigarette formulas as part of a pending lawsuit.
* Gains in key technology stocks helped pump up the Nasdaq market. Winners included Intel, up 2 7/8 to a record 126 5/8; Microsoft, up 1 3/4 to 155 1/2; Netscape, up 1 5/8 to 55 7/8; FileNet, up 1 3/8 to 34; Cabletron Systems, up 1 5/8 to 40 3/4; Motorola, up 1 7/8 to 55 3/4; and Vitesse Semiconductor, up 2 5/8 to 47 3/8.
Among Southland tech firms, Ortel surged 4 3/8 to 20 1/2 on a strong quarterly earnings report. And MRV Communications, a maker of fiber-optic equipment, jumped 2 3/4 to 20 1/4 after Intel agreed to invest in the firm.
* Smaller Nasdaq stocks gaining as the rally broadened included Sync Research, up 1 5/8 to 17 1/2; Penske Motorsports, up 1 to 30; and retailer Strouds, up 7/16 to 4 1/4. Also, Vacation Break USA soared 6 to 16 3/4 after the time-share company agreed to buy resort developer Berkley Group.
* Armor All Products rose 1 25/64 to 18 57/64 one day after Clorox said it will buy the company for $408 million in cash.
* Among the day's initial public offerings, technology research firm Forrester Research was well received, rocketing 6 to 22. But Firearms Training Systems, maker of gun-training systems sold mostly to the military, closed at 13 5/8, down from its IPO price of 14.
* Among Southland issues, Angeles Mortgage surged 2 1/8 to 11 5/8 after Insignia Financial Group said it may seek to acquire the real estate investment trust. Insignia gained 1 3/8 to 22 1/8.
Also, International Technology added 1/8 to 9 3/4 after a group including Wisconsin-based investment fund managers Brian Stark and Michael Roth said they had acquired 5.8% of the hazardous-waste disposal firm's shares, for investment purposes.
Market Roundup, D6