NEW YORK, DEC. 6 -- The Dow Jones industrial average brushed aside Middle East peace feelers and falling oil prices today, ending the day down 7 points.
Although the market started the day with an enthusiastic, high-volume advance of 40 points, the gains had all but disappeared by midday.
The move down was led by shares of IBM, which ended the day off 3 1/8 at 111 1/2, following reports, denied by the company, that future earnings might be lower than generally expected. Bank stocks also resumed their slide after an up day on Wednesday.
"I was sort of stunned that we ended down," said John Eberley, a stock trader at Chicago Corp. investment company. "My guess is that Bush's posture of nothing less than absolute withdrawal spooked some people."
In the bond market, a sensitive barometer of interest rates and the economy's direction, the key 30-year Treasury bond also ended with a loss after rising sharply on the Iraqi hostage announcement.
At the close, the Dow stood at 2602.48, down 7.92. Advances continued to outpace declines on the Big Board at the finish by about a 4-to-3 ratio. Volume weighed in at a massive 256 million shares by the close, the highest since the day after Iraq's invasion of Kuwait.
Among Dow components other than IBM, Chevron dipped 1 3/8 to 69 5/8, but International Paper managed a 1 1/2 gain to 51 and Minnesota Mining added 1 to 84 5/8.
NCR Corp. advanced 6 1/8 to 92 3/4 as speculators accepted the seriousness of AT&T's threat of a hostile takeover.
Money-center bank stocks, which have led rallies all week, fell victim to some serious afternoon profit-taking. Wells Fargo slipped 1 3/8 to 58 1/8, Republic New York skidded 3 to 47 7/8, J.P. Morgan gave up 2 1/4 to 43 3/4, Bankers Trust lost 2 to 42 1/4, Bank of New York eased 1 to 20 3/4, Mellon surrendered 1 5/8 to 24 1/2 and Citicorp gave up 1 in heavy trading, closing at 14 7/8.
Action in the stock of Orion Pictures helped persuade arbitrageurs that the takeover game remains alive. Orion rose 2 1/4 to 15 1/4, a 17 percent move, after a report in the Los Angeles Times said South Korean electronics giant Samsung Group may try to buy the studio. Orion, the smallest and poorest recent performer of the eight major Hollywood studios, said it had no comment on the report, which said that Samsung would pay about $300 million, or $15 per share, for the studio.
Oil stocks fell along with the price of oil. Exxon lost 5/8, closing at 49 5/8, Chevron eased 1 1/4 to 69 3/4, Texaco dropped to 57 5/8, down 7/8, Mobil was off 1 3/8 at 56 1/2 and Atlantic Richfield plunged 4 5/8 to 122.
Two retailers were heavily traded. The Limited rose 3/8 to 16 7/8 after reporting a 4 percent sales rise in November. Toys R Us was unchanged at 22 7/8, stable after its slide Wednesday.
Several biotech stocks took hits following analyst downgrades, among them Amgen, which lost 2 1/4 in over-the-counter trading, closing at 53 3/4, and Centor, which closed at 44, down 3. Imunex also lost 1 1/2 at 37 1/4.
The Dow transports closed up 10.12 at 913.79, outperforming the industrials, but the utilities eased 1.45 to 211.27.
Among broad stock indexes, secondary measures handily outperformed blue-chip indexes. The Standard & Poor's 500 closed down 0.85 at 329.07 and the New York Stock Exchange Composite finished off 0.40 at 179.71, but the Value Line gained 0.91 to 241.31, the Amex Market Value rose 0.94 to 306.35, and the Nasdaq Composite advanced 1.42 to 372.29.