STOCKS : Dow Up 1.48 in Mixed Market; Trading Erratic

The stock market posted mixed results Wednesday, swinging widely as it struggled to stabilize after Tuesday’s selloff.

The Dow Jones average of 30 industrials, which had fallen 45.54 Tuesday, rose 1.48 to 2,874.50.

But declining issues outnumbered advances by about 6 to 5 in nationwide trading of New York Stock Exchange-listed stocks, with 712 up, 859 down and 493 unchanged.

Big Board volume came to 167.94 million shares, against 169.94 million Tuesday. Nationwide, consolidated volume in NYSE-listed issues, including trades in those stocks on regional exchanges and in the over-the-counter market, totaled 203.51 million shares.

Analysts said investors grew restive Tuesday after it became evident that the Federal Reserve wasn’t ready to take new steps toward easier credit conditions.

In addition, the market faces a test of its optimism during the next few weeks as companies make their earnings reports for the first quarter, a period of generally difficult business conditions.

But hopes persisted that the economy will soon show increasing signs of recovery from the recession.

Traders of that school of thought appeared to lend some support to the market Wednesday, buying stocks whose prices have pulled back in recent sessions.

Inflation figures are expected to set the tone for the market through the rest of the week. The government is scheduled to report today on the producer price index of finished goods and Friday on the consumer price index.

Among the market highlights:

* Bank of New York fell 1 1/2 to 25 5/8 on top of a 2 1/8-point drop Tuesday, when the company reported a $63-million loss for the first quarter and cut its dividend.

* By contrast, Motorola, which posted a smaller quarterly earnings decline than some analysts had expected, climbed 6 3/4 to 62 7/8.

* Federal National Mortgage dropped 7/8 to 46 5/8. The company reported first-quarter earnings of $1.19 a share, against $1.06 in the 1990 period.

* USX gained 5/8 to 32 7/8. The company, which plans to split its oil and steel businesses into separate entities, said the new operations are expected to pay initial dividends that would together give a holder of a current share $1.60 a year.

* Among other actively traded blue chips, Pepsico rose 1/8 to 32 1/2, International Business Machines was unchanged at 111 1/4 and Philip Morris was down 1/8 at 68 1/8.

In London, the Financial Times-Stock Exchange index of 100 leading shares closed 8.4 points down at 2,518.8.

In Frankfurt, Germany, the DAX index of 30 leading shares closed down 20.22 at 1,561.89.

In Tokyo, the Nikkei average ended 48.53 points lower at 26,268.86.

Credit

Government bond prices fell after the Treasury disclosed the results of a note auction that traders found disappointing.

The Treasury’s bellwether 30-year bond fell 19/32 point, or $5.94 per $1,000 in face amount. Its yield rose to 8.26% from 8.20% late Tuesday.

Activity in the bond market has been light this week as investors await government inflation numbers today and Friday, said James Marshall, a trader with the Chicago investment firm Clayton Brown & Associates.

The bond market continued that trend until Wednesday afternoon, when the Treasury disclosed results from its auction of $8.5 billion in seven-year notes. Demand was lighter than expected, Marshall said.

“This was really the only thing to trade off of the past few days,” he said. “It didn’t take much” to send prices sliding.

The market is looking to the inflation figures to see whether the Fed may feel safe in lowering interest rates. If inflation has accelerated, the central bank may not have much room to lower rates.

The federal funds rate dipped to 5.625% from 5.79% late Tuesday.

Currency

The dollar rose broadly, strengthened by heightened unrest in the Soviet Union and reports of large dollar purchases by a major Asian bank.

The U.S. currency, which rose in European dealings, continued to strengthen in New York trading after reports that a large Asian bank had speculatively bought dollars.

Further fueling the rise were news reports that Georgia, the southern Soviet republic that declared independence Tuesday, was planning a strike to protest the presence of Soviet troops.

The dollar was also helped by a rumor, later proven untrue, that Georgia declared a state of war against the Soviet Union. Unrest in the Soviet Union is viewed as hurting neighboring economies such as Germany’s.

In London, the British pound fell to $1.7800 from $1.7900 late Tuesday. Sterling also weakened in New York, fetching $1.7760, less expensive than late Tuesday’s $1.7945.

Earlier in Tokyo, the dollar closed at 137.20 Japanese yen, unchanged from Tuesday. Later, in London, it fell to 136.30 yen; in New York, it rose to 137.43 yen from late Tuesday’s 134.85 yen.

Other late dollar rates in New York, compared to late Tuesday’s rates, included: 1.6800 German marks, up from 1.6655; 1.4295 Swiss francs, up from 1.4080; 5.6815 French francs, up from 5.6360; 1,246.00 Italian lire, up from 1,236.50, and 1.1513 Canadian dollars, down from 1.1525.

Commodities

The wholesale price for May deliveries of unleaded gasoline leaped more than 2 cents a gallon on the New York Mercantile Exchange futures market after a report showed a sharp drop in U.S. gasoline stocks.

Crude oil and heating oil futures also rose.

On other futures markets, grains and soybeans rose, precious metals fell and livestock and meat futures were mixed.

Unleaded gasoline futures settled 1.25 to 2.19 cents higher in New York, with the contract for delivery in May at 70.67 cents a gallon; light sweet crude oil was 35 to 79 cents higher, with May at $21.05 a barrel; heating oil was 1.26 to 1.56 cents higher, with May at 56.02 cents a gallon, and natural gas was 0.7 cent to 2.3 cents lower, with May at $1.376 per 1,000 cubic feet.

The selloff in the petroleum complex followed Tuesday’s weekly American Petroleum Institute inventories report. The association said the supply of gasoline in large domestic terminals and pipelines totaled 206.5 million barrels as of last Friday, down 4.9 million barrels from the previous week.

Gasoline stocks are only slightly above 205 million barrels, which is recognized by the Energy Deapartment as the minimum operating level before supply shortages could develop, according to the Pegasus Econometric Group of Hoboken, N.J.

Precious-metal futures prices fell on New York’s Commodity Exchange as traders took profits from Tuesday’s gains.

Gold finished 50 to 90 cents lower, with April at $364.40 an ounce; silver was 4.7 to 4.8 cents lower, with May at $3.985 an ounce.

Market roundup, D6