Stocks closed moderately higher in light and quiet pre-Christmas trading Friday as last-minute bargain hunting helped the market mount a modest Santa Claus rally.
The Dow Jones industrial average, which rose 13.12 points Thursday, climbed another 18.51 points to 3833.43 - its highest level since Nov. 16.Computer-driven buy programs sent the blue-chip indicator climbing more than 30 points in late trading but leveled off just before the close.
A big gain in Dow component General Motors gave the key barometer an added lift.
GM, the Big Board's second most active issue, jumped 21/8 to 411/4 after Donaldson Lufkin & Jenrette Securities Corp. raised its fourth-quarter earnings estimate for GM, citing better product mix in the United States and better results in Europe.
The other auto stocks also posted gains, with Chrysler climbing 3/4 to 487/8 and Ford Motor edging up 1/4 to 27.
The Dow transportation average chalked up a bigger gain, leaping 24.69 points to 1434.54 with the aid of strong airline issues.
The New York Stock Exchange composite index edged up 0.24 to 250.95, while Standard & Poor's 500-stock index inched up 0.16 to 459.83. The average price of a share gained 3 cents.
Advances topped declines 1,150-1,001 among the 2,900 issues crossing the NYSE tape.
Final floor volume slowed to 196,540,000 shares from 340,330,000 in the same period Thursday.
Prices ended slightly higher on the American Stock Exchange and the Nasdaq Stock Market.
Treasury securities and the U.S. dollar finished mixed.
The bellwether 30-year Treasury bond, which fell 7/32 Thursday to yield 7.85 percent, rebounded 8/32 to 96 6/32. The issue's yield, which moves in the opposite direction of its price, was 7.83 percent.
The dollar changed hands at 1.5795 German marks and 100.15 Japanese yen, compared with 1.5746 marks and 100.23 yen late Thursday.
In overseas trading, London closed slightly lower as market players found little motivation to take new positions ahead of the Christmas holidays. Frankfurt and Paris also eased.
Markets in Japan were closed in celebration of the Emperor's birthday. Trading will resume Monday.
On Wall Street, Alan Ackerman, executive vice president at Reich & Co., said last-minute bargain hunting helped the market mount "a modest Santa Claus rally despite all the pessimism over higher interest rates."
He added that the scarcity of sellers allowed the "bargain hunters to grab the reins."
But looking forward to next week's final trading days of the year, Ackerman cautioned that "we're not fully through tax-loss selling yet," referring to the practice of selling off losing or poor-performing stocks and declaring them as a loss for tax purposes.
Trude Latimer, vice president and chief market strategist at Ferguson Andrews & Associates Inc. in Charlottesville, Va., agreed that the market got a lift from some "bottom fishing" and the abatement of tax-loss selling.
Bottom fishing, which is similar to bargain hunting, refers to buying stocks at depressed levels.
"Most of the tax-loss selling is done by now," Latimer said, adding that "this is a time when you find the bottom fishers."
Analysts said Wall Street opened slightly higher as the market wound down for the Christmas holidays.
They said trading had been expected to be thin and quiet with some trading desks operating with skeleton crews and the bond market closing early at 2 p.m.
They noted that bonds started out on a steady note, generally shrugging off Friday morning's economic news as players prepared for an early close ahead of the Christmas holidays.
Shortly before the market opened, the Commerce Department reported that orders to U.S. manufacturers for expensive goods jumped 3.4 percent in November, or $5.3 billion, the largest monthly increase in three months.
Economists had expected a 1.7 percent rise in November durable-goods orders.
November's increase followed a revised drop of 0.9 percent in October, which originally was reported as a 1 percent decline.
In a separate report, Commerce said the personal income of Americans eased 0.1 percent in November, the first decline in 10 months, while consumer spending climbed 0.6 percent - in line with market expectations.
In October personal income jumped 1.4 percent, while spending climbed 0.7 percent.
On the NYSE trading floor, Telefonos de Mexico paced the Big Board actives, ending unchanged at 405/8, as Mexican issues stabilized after a four-day slide on concerns about the new peso's weakness and renewed peasant unrest in Mexico's southern state of Chiapas.
Construction concern Grupo Tribasa edged up 1/4 to 197/8 and Grupo Televisa rose 1/2 to 327/8, while financial services company Grupo Financiero Serfin slid 1/8 to 83/4 and truck maker Consorcio Grupo Dina eased 1/8 to 91/2.
RJR Nabisco Holdings was the third most active, edging up 1/16 to 55/8.
Among the airline issues, American Airlines parent AMR climbed 2 to 53, Delta Airlines jumped 37/8 to 495/8, United Airlines parent UAL rose 31/2 to 891/2 and Southwest Airlines gained 1/2 to 163/4.
Volume of NYSE-listed issues, including trades in stocks on regional exchanges and in the over-the-counter market, was 244,819,400 shares, compared with 416,287,780 traded in the previous session.
The Amex Market Value Index rose 1.26 to 428.78, while the average price of an Amex share added 3 cents. Advances edged declines 294-262 among the 789 issues traded. Composite volume eased to 19,503,400 shares from 21,773,700 traded Thursday.
Interdigital Communications led the Amex actives, climbing 11/8 to 67/8.
Epitope followed, jumping 37/8 to 247/8 after the Food and Drug Administration approved the company's OraSure, the first saliva test for the virus that causes AIDS.
The Nasdaq composite index gained 2.85 to 742.19. Advances topped declines 1,319-1,088 among the 3,647 issues traded.
Bay Networks paced the Nasdaq actives, climbing 15/8 to 283/4. Analysts said the computer networking equipment maker, which lagged other networking companies, was making up for lost time.
Cisco Systems followed, edging up 3/8 to 351/4.