NEW YORK -- The Dow Jones industrial average closed yesterday at its third record high this week, led by International Business Machines Corp. and Texaco Inc.
Broader indexes slipped as long-term interest rates rose on a surge in consumer confidence. Computer and semiconductor shares like Intel Corp. and Apple Computer Inc. paced the decline, countering strength in international oil shares.
"We've got an economy that's improving,and a positive outlook for corporate profits and inflation," said Alfred Goldman, director of technical research at A.G. Edwards & Sons.
Still, "bonds kept a damper on everything" yesterday, said Dale Tills, manager of institutional equities trading at Charles Schwab & Co. in San Francisco.
The Dow industrials climbed 10.89, to a record 3,740.67, eclipsing the previous high of 3,734.53, set Wednesday. The average was up 36.6 points for the week.
Among broader market indexes, the Standard & Poor's 500 Index fell for the third consecutive day, closing down 0.25, at 463.93. The Nasdaq Combined Composite Index fell for the fifth straight session, finishing 0.73 lower, at 760.75.
IBM, up $1.75, at $55.375, led the rise in the Dow industrials.
Texaco rallied $1.625, to $64.50; Chevron Corp. gained 62.5 cents, to $86.625; and Mobil Corp. surged $2.125, to $76.125, as crude prices rebounded from a five-year low. West Texas Intermediate gained 44 cents a barrel, to $15.07 a barrel.
Broader indexes were depressed by declines in Intel, which slumped $1.75, to $56.25, and Apple Computer, which fell $1.75, to $28.25.
Computer stocks took a drubbing this week amid weaker-than-expected semiconductor sales and concern about growth prospects at leading personal computer hardware and software makers such as Compaq Computer, Novell, and Microsoft.
In all, nine stocks declined for every eight that advanced on the New York Stock Exchange. Trading was moderate, with about 245 million shares changing hands on the Big Board, the lowest this week.
Most stocks declined as Treasury bond yields rose after the University of Michigan's preliminary consumer sentiment index for December rose from 81.2 to 87.7 in November, according to people with access to the report. The index was at its highest since January, when it was 89.3. Economists who forecast the index had expected a reading of about 84.
DTC The yield on the 30-year Treasury bond rose as high as 6.20 percent, up from Thursday's closing 6.15 percent. Yields rose because investors equate confidence with a better economy and, therefore, the potential for a rising inflation rate.
The confidence report countered more evidence that inflation is subdued as the economy recovers. The Labor Department said consumer prices rose 0.2 percent last month, matching economists' estimates. In October, the consumer price index climbed 0.4 percent, as the new fuel tax took effect.
Stocks didn't rally on the CPI because investors had already built a good figure into share prices, traders said. "The economy's been recovering, and people are looking at the CPI as the last good number," said Thomas Gallagher, chief trader at Oppenheimer & Co.
Chrysler Corp. soared $3, to $56. The automaker's earnings estimates and the estimated price target for its shares were raised yesterday by Salomon Brothers' Jack Kirnan amid optimism about an easing of production constraints and brisk sales of the Dodge Ram pickup truck. Maryann Keller of Furman Selz plans to raise her estimates as well.
Borden Inc. gained 62.5 cents, to $18.75, amid expectations that the board's ouster of chairman and chief executive, Anthony D'Amato, presages faster restructuring at the food company.
Ingersoll-Rand Co. fell $1.50, to $36.50. The maker of construction equipment was removed from the "recommended list" of stocks at Lehman Bros.
Viacom Inc. lost 87.5 cents, to $48.125. The Delaware Supreme Court ruled that Paramount Communications Inc.'s board breached its duties to holders when it pushed forward with a plan to merge with Viacom Inc. in the face of a higher offer from QVC Network Inc. Paramount eased 87.5 cents, to $81.125, and QVC shed 37.5 cents, to $43.25.
Medtronic Inc. jumped $1.875, to $84. The company won Food and Drug Administration approval to market its Transvene system designed to help correct a rapid heartbeat. Medtronic offered $6.75 a share for Electromedics Inc., topping an earlier offer from St. Jude Medical Inc.
Multimedia Inc. dropped $1.50, to $36.50. The Greenville, S.C., owner of five television and eight radio stations said President and Chief Executive J. William Grimes resigned to pursue other opportunities. He'll be succeeded by Chairman Walter Bartlett and Senior Vice President Donald Sbarra.
U.S. Long Distance Corp. tumbled $4, to $13.50. The provider of telephone services delayed a sale of 1.6 million shares amid an inquiry by the Securities and Exchange Commission.