Nasdaq Ekes Out Another High; Grains Tumble

Small-stock indexes closed at record highs for the eighth straight session Monday, but the market overall had a slow day as bond yields rose and as some investors braced for a heavy calendar of economic reports this week.

Meanwhile, prices of wheat and corn futures tumbled as long-awaited beneficial rains in the drought-stricken Midwest raised hopes that harsh weather may not hurt U.S. crops as much as feared.

On Wall Street, the Nasdaq composite index of mostly smaller stocks edged up 1.31 points to 1,188.20, after soaring 4.2% last week as investors focused on smaller firms’ earnings potential in a rebounding U.S. economy.

Among other small-stock indexes, the Standard & Poor’s small-cap index added 0.35 point to a record 135.07.

The blue-chip Dow Jones industrial average, which has taken a back seat to smaller stocks in recent weeks, gained 5.42 points to 5,573.41, mostly on the strength of rising energy stocks.

On the New York Stock Exchange, declining stocks narrowly outnumbered winners, while winners had the edge on Nasdaq. Trading slowed sharply.

Investor interest may have been chilled by rising bond yields. The 30-year Treasury bond yield ended at 6.84%, up from 6.79% on Friday and the highest since April 11. Shorter-term yields also rose.

The bond market is jittery as it faces a slew of economic reports this week, including March leading economic indicators, March factory orders and April employment. The latter report, due Friday, particularly worries bond traders: The last two monthly employment reports were far stronger than expected, causing bond prices to plummet and yields to rise.

The bond market got some good news Monday: Soaring grain prices reversed, dampening some inflation concerns.

May futures contracts for both wheat and corn at the Chicago Board of Trade dropped through the floor after rains fell from Kansas to Texas over the weekend and drenched the eastern Corn Belt on Monday.

May wheat futures plunged 65 cents to end at $6.52 a bushel, with subsequent delivery months down the 20-cent daily limit. May corn closed 33 3/4 cents lower at $4.74 a bushel, with the July and September deliveries down the daily 12-cent limit.

Grain prices had surged to 20-year highs in recent weeks on concerns about drought damage and low world grain stockpiles.

Among Monday’s highlights:

* Oil stocks gained as crude prices edged up again. Texaco rose 1 1/2 to 86 7/8, Exxon rose 1 1/2 to 85 7/8 and Unocal added 1/4 to 33.

* Paper and forest product stocks drew avid buying interest as investors were hopeful that this week’s economic data would offer further proof of a strengthening economy. Georgia-Pacific rose 2 1/2 to 78 1/4, Weyerhaeuser added 1 3/4 to 49 5/8, Boise Cascade rose 1 1/4 to 46 1/2 and Bowater climbed 1 1/2 to 40 1/4.

* Continuum surged 12 1/4 to 57 5/8 after the company and Computer Sciences agreed to a $1.5-billion stock-swap merger. Computer Sciences fell 2 3/4 to 75 3/8.

* Boeing finish unchanged at 80 3/4 after reporting its profit fell 34% as aircraft deliveries slowed in the aftermath of last year’s strike by machinists.

* Provident, a disability and life insurance firm, said it will acquire rival Paul Revere from Textron for more than $1.2 billion in cash and stock. Textron lost 1 to 86 1/8 and Provident rose 2 1/2 to 34.

* Canandaigua Wine plunged 6 3/4 to 29 3/4 after warning that its income for the six months ended Feb. 29 would be off sharply.

In currency trading, the dollar continued to weaken against the yen, falling to 104.67 in New York from 105.55 on Friday. The dollar also eased to 1.5265 German marks from 1.5284.

In Mexico City, stocks fell to their lowest levels in two weeks as the peso weakened and interest rates rose. The Bolsa index fell 16.87 points to 3,200.09.

London’s FTSE-100 fell 23.6 points to 3,809.2. In Tokyo, Japanese financial markets were closed for Greenery Day, a national holiday, and will reopen today.

Market Roundup, D8