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Blue-chips drift lower

ahead of jobs report

NEW YORK: Blue-chip stocks fell Thursday as the bond market was depressed by surprisingly strong economic data ahead of Friday's key March jobs report.

"Traders are very courageous to be willing to be long going into the weekend. There's the potential for a surprise for the jobs report," said Michael Metz, Oppenheimer & Co.'s chief investment strategist.

The Dow Jones industrial average fell 6.86 points to 5,682.88, a day after it closed at a record high of 5,689.74. In the broader market, declining issues led advances 1,182 to 1,044 on active volume of 386 million shares on the New York Stock Exchange.

U.S. stock markets will be closed on Friday for the Good Friday holiday.

The bond market is typically closed for the holiday as well, but the government's release of the March employment report led the Public Securities Association to recommmend a shortened session, which will end at noon EST.

Wall Street economists expect the report to show the creation of 60,000 new jobs in March, and an unemployment rate at 5.6 percent.

The Labour Department's report on March 8 that the nation added a mammoth 705,000 new jobs in February sent the key 30-year Treasury bond tumbling three points and the Dow down 171 points that day.

Metz believes the March data "will counterbalance the February report. My guess is they will be full of revisions and the economy is not as strong as people inferred."

He noted economic data for the first quarter were skewed by blizzards, government shutdowns and the General Motors Corp. strike. "You can almost throw out first-quarter data."

The 30-year bond fell 18/32, or $5.625 on a $1,000 bond, to yield 6.66 percent, up from 6.63 percent Wednesday.

Meanwhile, weekly U.S. jobless claims came in higher than expected at 408,000 against expectations for 377,000, largely due to the GM strike.

Volume on the NYSE was swollen by the start of trading of Lucent Technologies, the biggest U.S. initial public offering ever with 112 million shares priced at $27 apiece. About 39.3 million shares of the AT&T telecommunications equipment arm changed hands, before closing at 30-5/8.

"Lucent was pretty busy. That was half the game in town," said Jim Benning, a trader at BT Brokerage. Otherwise, "it was quiet" ahead of the long holiday weekend, he said.

Stronger sectors included airlines and oil stocks. Mobil rose 1-7/8 to 119-3/8, Texaco added 1-7/8 to 87-7/8 and Exxon was up 1-5/8 to 85-1/2 amid firmer crude prices.

Airline stocks firmed as expectations for a strong first-quarter performance mounted.

UAL, the parent of United Airlines, rose 4-1/8 to 221-1/8, American Airlines' parent AMR added 2-1/2 to 92-3/8, Continental class B shares rose 1-3/8 to 59-1/2 and Delta added 2-7/8 to 81-1/2.

Among individual shares, Circuit City rose 1-3/8 to 30-7/8 after reporting higher than expected fourth-quarter earnings.

Hyperion Software slumped 7-3/8 to 11-1/8 after an earnings warning and an Alex Brown downgrade.

BJ Services climbed 3-7/8 to 37-1/8 and Nowsco Well surged 6-1/4 to 21-1/2 in U.S. trading after BJ launched a takeover bid for Calgary-based Nowsco.

DecisionOne, which provides multivendor computer maintentance and technology support services, rose 3-7/8 to 21-7/8 in its first day of trading.

Another IPO, Excite Inc., which provides a popular Internet search directory, added 3 to 20. Sapient, which develops client/server and Internet-enabled client/server software applications, also debuted and jumped 11 to 32.

The Standard & Poor's composite index of 500 stocks edged down 0.02 of a point to 655.86. The American Stock Exchange index rose 2.78 to 577.10.

The Nasdaq Composite index rose 2.36 to 1,118.21.

The NYSE composite index rose 0.11 to 351.92, a second consecutive record. The average price per share rose 1 cent.

The Wilshire Associates Equity Index - the market value of NYSE, American and Nasdaq issues - was 6461.607, up 6.121 points or 0.09 percent. It rose 95.722 points for the week.-Reuter