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STOCKS FINISH LOWER AFTER VOLATILE AFTERNOON
PRICES PLUNGE IN A BOUT OF COMPUTERIZED SELLING, BUT FINAL LOSSES ARE MODERATE

SHARE STOCKS FINISH LOWER AFTER VOLATILE AFTERNOON
PRICES PLUNGE IN A BOUT OF COMPUTERIZED SELLING, BUT FINAL LOSSES ARE MODERATE

Stock prices suffered from the volatility typical of a "triple-witching hour" Friday, closing with a moderate loss after plunging at midafternoon due to a bout of computerized program selling.

The Dow Jones industrial average, which fell 7.46 Thursday, closed down 14.08 to 2739.55 after being down as much as 45 points at midafternoon.Among broader market gauges, the New York Stock Exchange composite index fell 0.50 to 193.47 and Standard & Poor's 500-stock index dropped 0.79 to 350.14. The price of an average NYSE share dropped 10 cents.

Declines pounded advances 898-619 among the 1,996 issues crossing the NYSE tape. Big Board volume totaled 240,390,000 shares, up dramatically from 178,700,000 shares traded Thursday and topping 200,000,000 shares for the first time since Oct. 24. In that session, the Dow industrials fell more than 80 points during the day but closed down 3 points in extremely volatile trading.

Although volume was very high, trading was at a moderate pace for most of the day. Turnover surged in the first hour, when expiration of December stock index futures and options was carried out as part of the quarterly "triple-witching hour." Another rush of trading occurred near the close, when individual stock options expired.

Some analysts blamed the selling on news that Panama's National Assembly declared that the country was in a "state of war" with the United States and named leader Gen. Manuel Noriega as head of government, formalizing the power he has wielded over the nation, saying shortly after the news broke, the Dow began its midafternoon plunge.

Others said the expirations, the announcement by Campeau Corp. earlier this week that it may seek bankruptcy for its retailing units and fears that the Federal Reserve will not move fast enough to rescue the economy from a more severe slowdown made the market especially vulnerable to the program selling that usually accompanies the volatile "triple-witching hour" sessions.

Computerized program selling is used to profit on price differentials between stocks and stock index futures.

"But the most important thing is the selling kicked in when there was no urgency to buy equities in the first place," said Alan Ackerman, senior vice president at Gruntal and Co.

On the trading floor, Bank of New England was the most active NYSE issue, tumbling 3 3/8 to 9 after reports that it plans to boost its loan-loss reserves sharply because of problem real estate loans.

AT&T followed, down 1/8 to 46 1/8. Exxon was third, up 1/2 to 50 1/8.

Among the blue chips, General Motors fell 1 to 42 1/2 after reports the Big Three automakers are expected to lay off temporarily as many as 100,000 workers next month and to beef up incentives to combat declining sales. IBM extended its slide, down 1/8 to 95, Minnesota Mining and Manufacturing dropped 3/4 to 80 1/2 and Primerica closed down 3/8 to 29 1/8.

Other banks were also under pressure after the Bank of New England report. Wells Fargo tumbled 2 3/8 to 69 7/8. Analysts pointed to its huge real eatate and construction loan portfolio as cause for concern. Bank of Boston lost 1 5/8 to 17 1/8 and BankAmerica closed off 5/8 to 26.

Elsewhere, The Gap sank 2 1/8 to 46 1/4. Analysts cited concerns about the retail sector after Campeau's announcement earlier this week. And DiGiorgio jumped 1 3/4 to 27 3/4 after reports saying management and an investor group had resumed talks on a $32 a share bid.

Prices closed lower in active trading on the American Stock Exchange.

The Amex Market Value index fell 1.32 to close at 375.50. The price of an average share dropped 5 cents. Declines led advances 344-236 among the 874 issues traded. Volume totaled 14,190,000 shares, compared with 14,640,000 traded Thursday.

Elsinore led the Amex issues, down 1/8 to 1/2.

The National Association of Securities Dealers composite index closed down 3.65 to 443.83.