NEW YORK, SEPT. 10 -- The Dow Jones industrial average fell almost 4 points today, erasing a 35-point midday gain as volatile crude-oil prices recovered from a steep morning loss and surged in late trading.
Rising foreign stock markets led the way to the market's initial gains in New York. Tokyo saw the Nikkei-225 surge 1,118 points to 25,080.
But traders said that volatile action in crude-oil futures was key to the instability of early gains that developed in both stocks and bonds. October crude, which closed near $30 on Friday, plunged more than $1.50 during the morning, and it not only recovered from the loss but settled up $1.26 at $31.30 after rising at one point by almost $1.70 in frenzied late trading.
Program trading helped to propel the market up during morning trading and lead it back down during three bouts in the afternoon.
On the cash market, traders said that there has been no new real leadership in the market for the last three sessions.
"You're getting the same tired leadership that you got last week," said technician Edward Nicoski at Piper Jaffray and Hopwood. "I think that secondary growth stocks are going to lead some kind of continued rally, but it's probably going to be a rally in a bear market."
At the close, the Dow stood at 2615.59, down 3.96, while advancing issues barely edged out declining issues. New York Stock Exchange volume was a light 119 million shares.
Among Dow components, Procter & Gamble translated an over full-point gain at midday into a 1-point loss at 77, and oil stocks, unable to keep pace with the rapid tempo of late gains in crude futures, slumped as well. Texaco lost 1 1/8 to 63 3/8, Chevron dipped 1 1/4 to 76 3/4 and Exxon surrendered 1/2 to 50 3/8.
Among the Dow transports, UAL Corp. added some spice to trading after it opened up 4 1/4 at 104 1/2 following a trading delay. The holding company for United Airlines benefited from rumors late last week that investor Marvin Davis, and possibly General Electric, may be cultivating a buyout deal that could take UAL shares to the $180-$200 range. UAL, however, finished up only 2 points at 102 1/4 after the broad market relinquished gains in late trading.
McDonnell Douglas added 1 1/8 to close at 48 3/4 after the U.S. and South Korean governments reached agreement on the sale of 120 Hornet jets, a contract that could be worth $4.7 billion to the airplane manufacturer.
Among volume actives, Toys R Us slumped 1 to 22 1/8, and Wal-Mart lost 1 to 27 after a Salomon Brothers analyst downgraded his recommendation on both issues from "buy" to "hold" in the face of the growing threat of recession to retail profits.
Among prominent percentage gainers, real-estate leasing firm Vornado surged 16 7/8 to 113 in appreciation of its transition to a real estate investment trust, while electronic shopping service CUC International rose 1 3/8 to 19 1/4.
The Dow transports inched down 0.17 to close at 908.11, while the utilities eased 0.45 to 200.45.
Among broad stock indexes, the Standard & Poor's 500 was down 1.77 at 321.63, the NYSE Composite down 0.81 at 176.70, the Value Line down 0.13 at 247.29 and the Amex Market Value down 0.56 at 323.21. The Nasdaq Composite gained 1.35 to 381.73.