Market Rally Pauses; Dow Slips a Fraction

NEW YORK —  The stock market was mixed in an erratic session Thursday, bogging down after the previous day’s rise to record highs.

The Dow Jones average of 30 industrials, which closed above 1,500 on Wednesday for the first time ever, slipped back 0.46 to 1,511.24. Most other market measures managed to post modest gains.

Trading continued to set a heavy pace. Volume on the New York Stock Exchange came to 170.54 million shares, off just a bit from Wednesday’s total of 178.47 million.

Analysts said there was nothing in the news to dampen the recent euphoria that has swept through the market. But they said some traders who had bought stocks in recent weeks on anticipation of congressional action against the budget deficit appeared to be selling to cash in their profits now that the Gramm-Rudman plan has become law.

Volcker Optimistic

The bill, passed by Congress late Wednesday and signed by President Reagan on Thursday, mandates an end to federal budget deficits by 1991.

Paul A. Volcker, chairman of the Federal Reserve, was quoted as saying the measure was a “healthy” step toward dealing with the problem of the deficit.

RCA was the day’s most active issue, falling 4 to 59 on volume of more than 10.8 million shares, while General Electric, also active, rose to 68 1/8. RCA shares jumped 10 3/8 points Wednesday before the announcement Wednesday evening that GE had agreed to acquire the company for $66.50 a share.

Energy stocks gained ground, rebounding from a sell-off early in the week. Exxon rose 1 5/8 to 51 5/8, Chevron 5/8 to 35, Amoco 5/8 to 61 and Mobil to 29 3/8.

Schlumberger climbed 2 1/8 to 35 1/8. The company said it was taking a write-off of $485 million in the fourth quarter in connection with its Fairchild semiconductor operations, but it also announced plans to buy back as many as 25 million of its shares.

Anheuser-Busch jumped 4 1/8 to 44 on takeover rumors. The company said it knew of no corporate developments to explain the activity in its stock.

Retailing issues were narrowly mixed following the Commerce Department’s report of a 1.1% rise in retail sales last month. F. W. Woolworth rose 1/2 to 62 1/8, Sears, Roebuck was unchanged and K mart was down 1/2 at 35 5/8.

Gainers held a nine to seven edge on losers in the daily tally on the Big Board. The exchange’s composite index added 0.32 to a new high of 119.12.

Nationwide turnover in NYSE-listed issues, including trades in those stocks on regional exchanges and in the over-the-counter market, totaled 203.82 million shares.

Large blocks of 10,000 or more shares traded on the NYSE totaled 3,397, compared to 3,742 on Wednesday.

The Wilshire index of 5,000 equities closed at 2,123.390, up 6.715.

Standard & Poor’s index of 400 industrials rose 0.81 to 229.56, and S&P;’s 500-stock composite index was up 0.42 at 206.73.

The NASDAQ composite index for the over-the-counter market gained 1.72 to 320.58. At the American Stock Exchange, the market value index closed at 241.78, up 0.62.

Bond Prices Lower

The rally in the credit markets ran out of steam as bond prices ended the session slightly lower. Interest rates made minor movements during the day.

Analysts said the market has been driven higher recently by the anticipation of passage of the deficit reduction legislation. When the bill was signed into law, some traders took the opportunity to take profits.

Bond traders paid little attention to the latest economic news.

A Federal Reserve Board report that the nation’s basic money supply, known as M1, jumped $5.3 billion in the week ended Dec. 2 didn’t stir up much of a response in the credit markets.

UMB Bank & Trust Co., the U.S. subsidiary of United Mizrahi Bank of Israel, announced that it cut its prime rate to 9% from 9 1/2%, effectively immediately.

The yield on a benchmark 30-year Treasury bond edged up to 9.55% from 9.53% late Wednesday.