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Nasdaq sets more

record high

NEW YORK: The Dow Jones industrial average got hammered Wednesday as investors sold blue-chip stocks and bought shares of smaller companies, driving the Nasdaq index to its fifth consecutive record high.

The 30-stock Dow Jones industrial average fell 34.69 points to end at 5,553.90. In the broader market, declining issues led advances 1,203 to 1,141 on heavy volume of 493.4 million shares on the New York Stock Exchange.

The Nasdaq composite index of high-technology and smaller stocks soared 10.07 points to end at a new high of 1,176.83, having climbed 76 points since April 15.

Also setting a new high was the Nasdaq trading volume of 735 million shares, which topped 700 million for the first time. The old record of 652 million shares was set Tuesday.

"Blue chips can't get out of the way and techs are flying. There's a great revival of speculative interest in this sector," said Michael Metz, chief investment strategist at Oppenheimer & Co.

Better-than-expected earnings reports from Compaq Computer and Netscape stoked further enthusiasm for technology issues.

"There's been a trend in the last few sessions where institutional types are working their way out of big blue chips and into high-techs," said William Lefevre, senior market analyst at Ehrenkrantz King Nussbaum.

"The techs are back in vogue, the new hot area, and monkey see, monkey do," he said.

Stronger technology issues included Compaq, which rose 2-7/8 to 47, Netscape, up 2-1/4 to 64 after rising 3-7/8 Tuesday. Micron was up three to 36-1/4, Hewlett-Packard gained three to 106-1/8, and Motorola jumped 1-1/2 to 63-1/4.

"The high-techs are dancing up a storm," said Alfred Goldman, technical research director at A.G. Edwards.

Investors are taking profits in blue chip stocks of companies both dependent and immune to swings in the economy, he added.

Among the blue-chips, Merck shed 1-3/8 to 60-3/8, Eli Lilly lost two at 55-3/8 and Warner-Lambert was off 3-1/8 to 111-3/4.

Blue-chip issues were also dogged by a rise in long-term bond interest rates. The 30-year Treasury fell 18/32, and the yield, which moves in the opposite direction, rose to 6.83 percent from 6.78 percent at Tuesday's close.

A rising dollar also weighed on the stocks of large multinational companies as investors fretted about the currency's negative impact on overseas sales.

"A strong dollar would temper the growth rates of these companies," Metz said. "I think the dollar will rise the rest of the year with a negative impact (on multinational company results) every quarter and I see the dollar strengthening more in 1997."

Among other issues Walt Disney Co., which fell on Tuesday on disappointing results, lost a point to 60-5/8.

Cigna rose 4-3/8 to 112-1/8 after its board approved a $500 million stock repurchase plan.

Digital Equipment rose 1-1/4 to 61-5/8, adding to Tuesday's gain of 4-7/8 on higher quarterly earnings.

Intel rose 2-9/64 to 70-1/4 after SoundView raised its opinion of the stock and boosted 1996 earnings estimate.

Glenayre Technologies jumped 7-7/8 to 45 on strong first-quarter sales and income.

Among initial public offerings, Outdoor Systems, an outdoor advertising company, jumped six to 21 and Axent Technology, which develops information security solutions, rose 4-3/4 to 18-3/4.

The Standard & Poor's composite index of 500 stocks fell 1.41 points to 650.17. The American Stock Exchange index fell 1.68 to 589.05.

The NYSE Composite index of all listed common stocks fell 0.64 to 348.96. The average share was down 8 cents.

The Wilshire Associates Equity Index -- the market value of NYSE, American and Nasdaq issues -- was 6,466.505, down 1.233 or 0.02 percent.-Reuter