U.S. stocks were mixed yesterday as gains among banks and computer chip makers offset sliding oil shares.
The Dow Jones industrial average rose 5.39 to 6,709.18, its fifth record close in six sessions, led higher by J. P. Morgan & Co., which reported robust earnings for the fourth quarter.
The 30-stock average would have risen more were it not for the declines in its four oil-related companies -- Exxon Corp., Chevron Corp., Texaco Inc. and DuPont Co. -- which subtracted 18.5 points on the day amid concern that oil prices may have peaked.
The Standard & Poor's 500 index barely climbed to its second consecutive closing peak, up 0.01 to 759.51. The Nasdaq composite index fell 1.11 to 1330.91, after rising 5.75 to an intraday record of 1337.77.
The Russell 2000 index of smaller shares fell from Friday's high, dropping 0.24 to 365.85. The Wilshire 5000 index lost 2.68 to 7360.05.
Trading on the New York Stock Exchange fell to 444 million shares, 102 million fewer than Friday's total. Shares that rose topped those that dropped on the NYSE by 1,319 to 1,223.
Among the Dow industrial stocks, Exxon dropped $2.625 to $103 after Merrill Lynch & Co. cut its investment rating to "hold" from "accumulate."
But J. P. Morgan climbed $2.75 to $102.50 after it said profit rose 14 percent in the fourth quarter. Morgan reported earnings of $2.04 a share in the final quarter of 1996 as investment banking and trading revenue surged. That beat the average forecast of $1.69 a share, according to IBES, a Wall Street publishing firm.
First Union Corp. helped its shares by announcing a $1.89 billion, 25 million-share buyback. If the bank carries out the full plan, it would repurchase 8.7 percent of its shares outstanding. First Union rose $1.875 to $77.375.
NationsBank Corp. topped its fourth-quarter profit estimate by 7 cents, earning $2.19, up from $1.87 in the year-earlier period. The Charlotte, N.C.-based bank's shares initially gained 50 cents, then fell 38 cents to $102.875 after Chief Financial Officer James Hance told analysts that 1997 earnings will be lower than previously predicted as a result of NationsBank's $9.78 billion acquisition of Boatmen's Bancsshares Inc.
Intel Corp. jumped $2.375 to $146.875, another closing high. The top maker of computer chips may report earnings as high as $2.00 a share for the fourth quarter today after the market's close, analysts said. The consensus estimate is for $1.83, according to IBES.
Rival chipmaker Advanced Micro Devices Inc. gained $2 to $29.75 after the company released a new microprocessor on par with some of Intel's Pentium lines of chips.
Constantine Fliakos of Merrill Lynch threw oil stocks into a tailspin after two days when gains by the group propelled the Dow industrials to records.
In cutting his Exxon rating, Fliakos said the company's price fully values its potential earnings growth. Fliakos forecast a drop in crude oil prices to near summer lows that would cut Exxon's 1997 profit growth to nil.
The price of crude oil slid 90 cents to $25.19 a barrel. Crude oil jumped above $26 a barrel in the past couple of weeks -- a six-year high -- from a low of about $20 in July.
Mobil Corp. dropped $2.50 to $127.625 and Anadarko Petroleum Corp. fell $1.375 to $70.875. Chevron slid $1.375 to $68.125 and Texaco slipped $1.875 to $105.50. Chemical maker DuPont, which owns oil refiner Conoco, backtracked $1.375 to $104.625.
Even with yesterday's decline, share prices of U.S. oil producers listed in the S&P; 500 index have risen 5.1 percent. Oil and gas drillers are up 17 percent.
American Standard Cos. shares gained $3 to $43.25 after the maker of Trane air-conditioners and plumbing fixtures rejected a $50-a-share offer from Tyco International Ltd.
Pub Date: 1/14/97