Blue-Chips Hit 2nd Record High; Oil Prices Sharply Up

Market Overview

* Blue-chip stocks managed to eke out a second straight record high Monday, despite the earthquake in California and the bout of profit taking that pushed many other major market indicators lower.

* Crunching cold in the East and earthquake-related supply fears drove oil prices sharply higher. Gold also rose sharply.

Stocks

The Dow Jones average, which was led by stocks of cyclical companies that benefit most in an expanding economy, rose 3.09 to 3,870.29, eclipsing its previous mark of 3,867.20 set on Friday.

However, declining issues narrowly outnumbered advances on the New York Stock Exchange.

“The market was quiet. There was just not a lot happening,” said James Melcher, founder and president of Balestra Capital. The Martin Luther King Jr. holiday kept many market players away, analysts said. Also holding down stock market activity was an East Coast storm and a closed U.S. bond market. Big Board volume fell to 233.98 million shares, down from Friday’s 304.91 million and the lowest one-day tally so far this year.

Investors mostly sold stocks that ran up in value during last week’s record-setting sessions, said Al Goldman, director of technical market analysis, with A.G. Edwards & Sons in St. Louis.

Among the market highlights:

* Parametric Technology was the most-active Nasdaq issue, falling 5 to 33 1/4 after the software company said fiscal fourth-quarter earnings were 25 cents a share vs 14 cents in the same period last year.

Universal Electronics also plunged on earnings news, dropping 10 to 9 3/4. The company said earnings for the fourth quarter were 24 cents a share versus 69 cents in the same quarter of 1992.

And Qualcomm fell 3 1/8 to 51. The telecommunications company announced fiscal first-quarter earnings of 18 cents a share versus a loss of 8 cents in the same period of last year.

* On the plus side, industrial issues that continued to rise included Caterpillar, up 2 to 92 1/2; Alcoa, up 1 1/4 to 74 1/4; and Deere, up 3 1/8 to 79 5/8.

But IBM was down 1 1/8 to 57 1/2. Kemper Securities lowered a rating on the stock, citing price.

* In the health-care sector, Medical Care America lost 7/8 at 23 1/8 on the NYSE after saying it would sell its struggling home-infusion unit to Caremark International for $175 million.

* First Interstate Bancorp fell 1 1/8 to 68 3/4 after a Paine Webber analyst downgraded the stock, citing price. The stock on Friday reached a 53-week high of 70.

In overseas markets, London’s FTSE-100 index added 7.2 points to 3,407.8. In Frankfurt, the DAX index eased 4.44 points to 2,137.38. In Tokyo, the Nikkei index lost 248.33 points to 18,725.37. Mexico City’s Bolsa was up 19.65 points at 2,506.33, a gain of 0.79%.

Other Markets

A weather forecast calling for below-normal temperatures in the Northeast, the main heating-oil consuming region, pushed home heating oil prices up 1.41 cents to 53.67 cents a gallon on the New York Merc. The rising price of heating oil helped boost crude oil prices hit a five-year low of $13.75 in mid-December.

February delivery of light sweet crude rose 32 cents per barrel to $15.10 Monday.

The Los Angeles earthquake prompted additional buying, analysts said. Power outages caused by the quake were believed to have shut down some oil refining operations south of Los Angeles, although no major damage to refineries was reported.

Meanwhile, gold for current delivery rose to $391.60 an ounce, up $2.10 on the New York Comex. Silver settled at $5.309 an ounce, 9.9 cents from $5.210 on Friday.

Meanwhile, the dollar settled mixed in light, uneventful trading. In New York, the dollar closed at 111.10 Japanese yen, up from 111.05 yen on Friday. It also ended at 1.755 German marks, up from 1.751.

Market Roundup, D8