Stocks Get Boost From Late Buying : Dividend-Related Trading Lifts Volume; Dow Adds 11.73

NEW YORK — A late round of buying attributed to computer program trading gave the stock market a lift in the waning moments of an erratic session Wednesday.

The Dow Jones index of 30 industrials, down about 10 at its afternoon lows, closed with an 11.73-point gain at 2,104.37.

Traders said it was significant that the Dow was able to close above the 2,100 level after finishing below the psychologically significant mark Tuesday for the first time in almost three weeks.

Volume on the floor of the Big Board came to 218.93 million shares, against 161.65 million in the previous session. Roughly one-third of the shares traded Wednesday were in dividend-related activity. Excluding those trades, volume was moderate.

‘Good for Market’

Analysts said the volume indicated that many investors were still sidelined awaiting several significant indicators, including Friday’s release of the U.S. trade deficit for May.

Testimony by Federal Reserve Chairman Alan Greenspan to the Senate Banking Committee that a further rise in interest rates is not inevitable helped the market, traders said. Investors had been getting increasingly worried that the Federal Reserve would nudge interest rates higher because of last week’s report showing the U.S. unemployment rate had fallen to its lowest level in 14 years and that during June there had been a big rise in non-farm payrolls.

Greenspan also said that he knew of no plans for foreign central banks to raise interest rates and that U.S. inflationary pressures may remain in check or even ease.

Wide swings in the dollar are to be avoided, he said, although the exchange value of the dollar need not be perfectly stable.

“Greenspan’s talk has to be considered good for the market,” said Don Hays, an investment strategist with Wheat First Securities. “He’s certainly doing things to calm the waters.”

Traders said sharply higher commodity prices weighed on bond prices.

The Commodity Research Bureau index was up more than 300 basis points, and the key 30-year U.S. Treasury bond closed about one-half point lower.

“The economic numbers have gotten people a little antsy,” said Larry Greenwald, a trader at Sanford C. Bernstein Co. “They don’t know what the data will hold.”

Nikko Securities Inc. head trader Bill King said that in the absence of retail and institutional interest, the market was easily knocked up and down by professional traders, causing some of the earlier swings in the Dow.

Tokyo Market Lower

“We don’t have the new money from the public and the institutions coming in,” King said. “No one wants to carry big positions with the numbers coming out. We did see some money coming into the market today, but it’s not a groundswell yet,” he said.

Gainers among the blue chips included General Electric, up 5/8 at 43; Philip Morris, up 1 at 89 7/8; Exxon, up 5/8 at 45 1/8, and McDonald’s, up 1/2 at 46 3/4.

In Tokyo, share prices closed lower Wednesday over concern about U.S. May trade figures to be released Friday, however the market closed above its morning lows, brokers said.

The Nikkei index lost 79.74, to close at 28,020.10.

Stocks rose in light trading on London’s Stock Exchange Wednesday.

The Financial Times 100-share index ended up 12.8 at 1,871.3.