NEW YORK -- U.S. stocks were mixed yesterday, as investors sold Procter & Gamble Co. and other issues that soared in the past year and bought computer-related shares.
"People are saying the market as a whole is expensive, but these [computer] stocks look cheap," said Mike Molnar, managing director in charge of Nasdaq trading at Smith Barney Inc. in New York.
"There's been a lot of talk that earnings growth for the Standard & Poor's 500 will be lackluster, while technology stocks are sporting a 30 or 40 percent growth rate," Molnar said.
The Dow Jones industrial average lost 10.91 to 8,187.54, dragged down by P&G;, the world's largest maker of household products and the highest-priced stock in the Dow at $148 a share.
The Nasdaq composite index rose for a sixth day to a record, gaining 16.08 to 1,621.53. The Standard & Poor's 500 index gained 2.07 to 952.37.
Among broad market indexes, the Russell 2,000 index of small capitalization stocks rose 2.69 to 418.31; the Wilshire 5,000 index of stocks on the New York, American and Nasdaq stock exchanges jumped 35.48 to 9,040.54; the American Stock Exchange composite index advanced 4.06 to 650.65; and the S&P; 400 midcap index added 1.75 to 316.83. All were records.
Computer-related shares got a boost from Goldman Sachs Group LP analyst Richard Sherlund, who told clients that computer company profits are expected to grow faster than earnings for the broad stock market through 1997 and 1998.
Intel Corp., the most active stock in U.S. markets, rose $2.9375 to $99.6875.
"Investors are pushing coins from one basket to another," said James Margard, who helps oversee $3.9 billion as chief of equities at Rainier Investment Management in Seattle. "Prices of many big-cap stocks, like Procter & Gamble, have gotten ahead of themselves. Money's going into technology and small-cap stocks."
P&G; fell $1.25 to $148.
Cisco Systems Inc. rose 31.25 cents to $81.9375 as investors anticipated strong earnings from the world's largest networking company.
After the market closed, Cisco reported earnings of 55 cents a share, matching estimates, up from 41 cents a year earlier.
In an unofficial estimate, one analyst had predicted Cisco could earn 57 cents. Martin Pyykkonen, an analyst at Furman Selz, said Cisco's profit margin improved because of higher software content in its products.
Cisco tumbled 38 percent from Jan. 21 to April 25, and many other networking and computer-related shares took similar dives amid concern that competition would slice into profit margins.
Aetna Inc. tumbled $14.25 to $102.75. Although the insurance company reported profit in line with expectations, its prognosis for growth disappointed analysts.
British Petroleum PLC's American depositary receipts rose $2.25 to $83.75, after Europe's second-largest oil company said it would buy back an undisclosed amount of its stock. It reported a 14 percent rise in quarterly profit, beating expectations and sending its shares higher in London trading.
Viacom Inc. shares gained 31.25 cents to $30.50 after the media giant reported a second-quarter loss of 8 cents a share, before a charge and a gain. The loss was less than the 14 cents a share analysts expected.
BankAmerica Corp. fell $1.625 to $71.875. The bank was removed from the "fresh money buy list" by strategist Byron Wien at Morgan Stanley, Dean Witter Discover & Co.
First Union Corp. lost 62.5 cents to $48.875; NationsBank Corp. fell $1.4375 to $69.1875; and J. P. Morgan & Co. was unchanged at $114.
Lone Star Steakhouse & Saloon Inc. fell $4 to $18 after warning that third-quarter earnings will fall short of expectations.
Enserch Exploration Inc. plummeted after it slashed its estimate of its oil and natural gas reserves. Enserch fell $1.8125 to $8.
Pub Date: 8/06/97