Stocks slip from record highs Dow industrials fall 12.56 points to 5,736.26

THE BALTIMORE SUN

NEW YORK -- U.S. stocks slipped yesterday from record highs, led by oil company and computer-industry shares.

The Dow Jones industrial average fell 12.56 to 5,736.26; the Nasdaq composite index lost 3.69 to 1,244.42; and the Standard & Poor's 500 index dropped 0.39 to 672.76.

The Standard & Poor's Midcap index fell 0.28 to 242.14; the Russell 2,000 index, which tracks shares of small and mid-size companies, fell 0.03 to 363.04; and the Wilshire 5,000 index, which tracks stocks on the New York, American and Nasdaq exchanges, fell 6.29 to 6,712.84.

All six of those indexes fell from records set Monday.

The American Stock Exchange market value index rose 2.87 to 612.23 yesterday, extending its Monday record.

Stocks lost earlier gains, tracking bonds, after a report indicated that retail sales in May were stronger than expected. The yield on the benchmark 30-year Treasury bond rose 2 basis points to 6.85 percent.

Earlier, the Federal Open Market Committee declined to change the overnight lending rate that banks charge each other. Investors expected no change, believing the economy's growth isn't fast enough to accelerate inflation.

Declining stocks led advancers by 1,211 to 1,162 on the New York Stock Exchange. Volume of 410 million shares lagged average daily volume since the beginning of the year of about 423 million shares.

Exxon Corp. and Chevron Corp. fell after reaching all-time highs yesterday in the wake of an agreement to let Iraq export oil for the first time in six years, as the price of crude oil dropped. Exxon slid $1.125 to $86.125 and Chevron lost $1.50 to $60.50.

Iomega Corp. shares closed at $43.375, up $2.0625, after rising to $48.625. The storage disk-drive maker announced a 2-for-1 stock split Monday. Some 18.2 million shares changed hands yesterday, making Iomega the most active stock on U.S. exchanges.

But computer, software and semiconductor shares generally declined. Microsoft Corp. fell $1.625 to $115.125; Cisco Systems Inc. lost $1.125 to $55.125; and Intel Corp. fell 75 cents to $70.25.

Companies with products that sell well whether the economy grows or not outperformed businesses that do best in a growing economy. The Morgan Stanley consumer index rose 1.14 to 303.08, led by Crown Cork & Seal Co., up $1.375 to $47.75, Anheuser-Busch Cos., up $1.875 to $71.75; and Walgreen Co., up 62.5 cents to $34.375. Morgan Stanley's cyclical index of economically sensitive companies lagged, rising 0.18 to 392.53.

Some U.S. retailers gained amid signs that business is recovering. Dayton Hudson Corp. jumped $4 to $106 after reporting that its fiscal first-quarter profit rose almost fourfold because of strong sales at its Target discount stores and a rebound at its Mervyn's chain.

Talbots Inc. rose 25 cents to $31.625 after the retailer said it earned 62 cents a share in its first quarter, matching its performance from a year earlier.

A series of computer-guided sell orders helped drive the Dow industrials down in the early afternoon.

Pub Date: 5/22/96

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