Well, it was mostly higher.
After yesterday's giddy gains and today's triple witching--the simultaneous expiry of index futures and options on indexes and individual shares--traders were reluctant to sweep shares much higher.
Dow Jones Industrials Average
erased most of an early 75-point gain to close a mere 10.76 points higher at 6,484.40. The broader
rose 3.11 points to 748.87. By comparison, the
gave up 7.30 points to 1,288.56, while the
, which measures small-cap stocks, dipped 0.07 to 356.03.
The lackluster finish belies what was a wild day. A whopping 655.5 million shares changed hands--the second busiest day in history.
Interest rates behaved even after the government said the economy grew a revised 2.1%, slightly less than expected, in the third quarter. Bond traders were reluctant to celebrate. They were still waiting to pore over the
, released in the late afternoon, for evidence of whether a rate hike may be in the making. The yield on the long bond was little changed at 6.59%.
With just a week of trading left in 1996, those not too busy counting profits were optimistic--if cautious--about the prospects for the New Year. "1997 will be a good year but not necessarily a great one for U.S. equities," was the modest appraisal from
Abby Joseph Cohen
in a report this week. Her 1997 year-end targets: 815 on the S&P, and 7050 for the Dow subject to the self-preserving caveat: "These targets are given to provide direction, not precision."
Nonetheless, most sectors posted a modest rise as traders looked for pre-holiday sales. Banks, in particular, benefited from stable bond yields and a
decision allowing them greater access to investment banking. The Fed caught commercial banks under the mistletoe, giving the okay for them to collect as much as 25% of their revenue from securities underwriting and trading.
"This helps banks provide one-stop shopping in a world where consumers increasingly demand that kind of convenience," said
, an analyst at
. Among those benefiting:
J.P. Morgan & Co.
(JPM:NYSE), up 5/8 to 98 5/8;
, up 2 1/2 to 103 1/8; and
(NB:NYSE), up 3/8 to 98 7/8.
shareholders unwrapped an early gift from
The investment house raised the drink maker to buy from hold on improved earnings expectations. Coke was up 1 3/4 to 52 7/8.
Most tech stocks didn't rise with the rest of the market.
(IBM:NYSE) slipped 3 1/2 to 154 5/8 and
fell 1 7/8 to 76 5/8.
The shining exception:
(AAPL:Nasdaq), which jumped 1 1/4 to 23 1/2 on reports founder Steve Jobs will rejoin the company.
Finally, investors took the fizz out of
Redhook Ale Brewery
(HOOK:Nasdaq) on expectations that earnings will be disappointing. The company slid 4 to 9 3/4.
By Andrew Morse