The rumors started in the London bond market and spread through Europe, reaching U.S. shores as dawn broke: "Good morning," the Dow Jones wire greeted Wall Street. "White House Press Officer Denies Rumors Reagan Is Ill."

The president had not had a heart attack and was "pleased that he had pulled off another Mark Twain," White House spokesman Larry Speakes said at the morning briefing after White House switchboards were swamped by calls from financial centers inquiring about Reagan's health.

No one knows how it started. But while the rumor lived, the price of gold rose by $4 to $5 and the dollar lost ground, dropping 3.5 pfennigs against the German mark, according to financial analysts.

The president and his dog Lucky reported for work as usual in the Oval Office, Speakes said.

Reagan, 74, was, Speakes added, "hale and hearty, ruddy and robust, vigorous and virile, strong and sturdy, fit and feisty. He was natty in a brown suit, matching tie. I didn't look at the color of his socks."

One administration official said he is convinced the heart attack rumor was a deliberate attempt to manipulate the market, because of the pattern in which the dollar declined on various markets. "It's what in Wall Street would be called a bear raid. Short the market, start a rumor, cover your shorts, get the hell out."

The technique of sending a market down to suit one's needs of the moment began, he said, as far back as the early 16th century, when "bears" started rumors that ships had been lost rounding the Cape of Good Hope. But he also said that there is almost no way to trace this phenomenon.

There was also speculation that yesterday's brushfire started when someone misunderstood or garbled a news report that George Chandler, 86, an actor who played Uncle Petrie in the "Lassie" television series, had died June 10 in Los Angeles of cancer and Alzheimer's disease. Chandler succeeded Reagan as president of the Screen Actors Guild in 1960.

The rumor mills churn up a presidential illness or assassination periodically. The mills have been more active under Reagan, specialists say, presumably because of his age and the assassination attempt against him in 1981. But, as Twain said, the reports of his death have always been greatly exaggerated.

"It seems to happen about once every six months," said a White House press aide. "The rumor dies very quickly once Larry Speakes knocks it down."

Beginning at 5:15 a.m., The Washington Post received phone calls from London, Hong Kong, Paris, Rome, New York, Chicago and other points, from the foreign exchanges, gold dealers and news people, asking about the president.

One foreign exchange trader in Manhattan arrived for work to find "all the traders standing around" repeating the rumor, she said. "Then someone would say, 'Oh, but it was only a mild one heart attack .' Then someone would say he heard a special Cabinet meeting was scheduled . . . . The corporations got scared and started calling around."

Similar dust-ups have happened, the trader said, over rumors that the Organization of Petroleum Exporting Countries is disbanding, OPEC is changing the price of oil, that something has happened in connection with the Brazilian debt, and so on.

The dollar is considered a "haven" currency by traders in other nations, in part because of the country's stable leadership. When a rumor, especially one involving the president, creates uncertainty, the players often switch back to their home currency, resulting in a weakening of the dollar. The markets react quickly because of the amounts of money at stake. "People are afraid to wait and see if the rumor is true," one analyst said. The cycle is accelerated now with computerization and international around-the-clock trading, specialists said.

The alarms usually start in Europe, which is at work while U.S. officials are asleep and unavailable to scotch budding rumors.

"They don't have the perspective in London that we do so they tend to react more emotionally," said William V. Sullivan Jr. of Dean Witter Reynolds Inc. securities firm. "They're remote from our communications network. They can't say, 'Gosh, he Reagan looked fine in Bloomfield yesterday.' Just as I don't know a thing about how Maggie Thatcher is . . . . It's just easier to get mileage out of a rumor there."

Reagan was informed about the scare at his morning meeting with White House chief of staff Donald T. Regan, officials said. The president had been awakened at 7 a.m., to be told of the hijacking of a plane with Americans aboard.