Closing Market Report

Star-Bulletin news services

Tuesday, June 4, 1996


Blue chip gauge advances 41

NEW YORK - Stocks were mostly higher on Tuesday as interest rates eased in the bond market, but trading remained quiet in advance of Friday's key report on employment.

The Dow Jones industrial average rose 41.00 to 5,665.71. In the past six sessions, the barometer of 30 big U.S. companies had lost nearly 140 points as investors questioned the stamina of the latest rally.

In Tuesday's rally, advancers led decliners by 1,456 to 903 on the New York Stock Exchange. NYSE volume totaled 384.46 million shares vs. 314.96 million in the previous session.

Broad-market indexes were mostly positive, but retreated from their highs for the session as bonds gave up some of their early gains.

The NYSE composite rose 2.53 to 360.80 and the S&P 500 list was up 4.90 at 672.58.

The Nasdaq composite index gained 4.18 to 1,242.91, but the American Stock Exchange's market value index fell 1.27 to 607.44.

Without any market-moving news or economic surprises, the direction of stocks remained hinged to interest rates in the bond market.

The yield on the 30-year Treasury bond - a benchmark used to set the interest charged on many types of loans - closed just below 7 percent on Tuesday, down from Monday's close of 7.01 percent.

"The bond and stock markets are imprisoned by this Friday's employment number," said Russ Labrasca of Sutro & Co. in San Francisco, referring to the government's monthly tally of new claims for unemployment benefits.

The markets have plunged on the strong employment picture depicted in the last three monthly readings. The implied increase in spending power has spurred worries that higher demand would translate into rapid inflation.




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