The stock market managed to end a bleak year on a positive note Monday as money managers snapped up strong issues to dress up their portfolios.
The Dow Jones average of 30 industrials rose 4.45 to 2,633.66, closing out 1990 with a net loss of 119.54 points, or 4.3 percent.
Advancing issues outnumbered declines by about 5 to 3 in nationwide trading of New York Stock Exchange-listed stocks, with 1,018 up, 596 down and 424 unchanged.
Volume on the floor of the Big Board came to 114.13 million shares, against 111.04 million in the previous session. Nationwide, consolidated volume in NYSE-listed issues, including trades in those stocks on regional exchanges and in the over-the-counter market, totaled 151.25 million shares.
Big Board volume for the year totaled 39.66 billion shares, the lowest annual figure since 35.68 billion shares were traded in 1986.
The markets will be closed today for New Year's before starting 1991 on Wednesday.
For most of the year, blue-chip stocks outperformed the much larger ranks of smaller "secondary" issues. Broad-based market indicators suffered 1990 percentage losses that were twice or three times bigger than the Dow Jones industrial average's.
But that order was reversed on Monday. Analysts said professional traders appeared to be nibbling at a good many depressed stocks in hopes of catching an early-1991 rally in this sector of the market now that the pressure of year- end tax selling has lifted.
Among the top NYSE percentage gainers were such issues as Home Shopping Network, up 3/8 at 4; Bernard Chaus, up 1/4 at 2 1/8 ; Dime Savings Bank of New York, up 1/4 at 2 3/8 ; USF&G, up 1/2 at 7 5/8 , and CV REIT Inc., up 3/8 at 3.
Gainers among the blue chips included Philip Morris, up 7/8 at 51 3/4 ; American Express, up 1/4 at 20 5/8 ; AT&T, up 1/8 at 30 1/8 , and Procter & Gamble, up 3/4 at 86 5/8 .
Precious-metals stocks were another strong spot. ASA Ltd. rose 1 3/8 to 46 7/8 ; Homestake Mining 5/8 to 19 1/4 , and Newmont Gold 1 7/8 to 42 1/2 .
As measured by Wilshire Associates' index of more than 5,000 actively traded stocks, the market increased $14.69 billion, or 0.48 percent, in value.
The NYSE's composite index of all its listed common stocks gained .84 to 180.49.
Standard & Poor's industrial index rose 2.16 to 387.42, and S&P's 500-stock composite index was up 1.50 at 330.22.
At the American Stock Exchange, the market value index closed at 308.11, up 3.46.
The NASDAQ composite index for the over-the-counter market added 2.64 to 373.84.
MCI Communications was the most active OTC stock, up 1 1/8 to 19 7/8 .
Bond prices closed higher in quiet trading Monday, while the rate for overnight loans between banks skidded sharply after the Federal Reserve moved to offset a predicted short-term credit crunch.
The Treasury's bellwether 30-year bond rose 11-16 point, or $6.88 per $1,000 in face amount, at closing Monday. Its yield, which falls when prices rise, was 8.24 percent, down from 8.30 percent late Friday.
Yields for the 30-year bond posted a slight gain in 1990, ending up about 1/4 percentage point above 1989's closing figure of 7.97 percent.
The federal funds rate, the bank overnight loan rate and a closely followed indicator of the Fed's activities, fluctuated throughout the day.
The rate fluctuated in a range of 6 percentage points but didn't skyrocket as some economists had expected. It traded around 2 percent late Monday, down from 7 1/2 percent late Friday, according to the Telerate Inc. financial information service.
In the secondary market for Treasury bonds, short-term maturities rose 3-16 point to 9-32 point, intermediate maturities rose 3/8 point to 7-16 point, and long-term issues were up 17-32 point to 11-16 point, Telerate Inc. reported.
The movement of a point is equivalent to a change of $10 in the price of a bond with a $1,000 face value.
The Lehman Brothers Daily Treasury Bond Index, which measures price movements on all outstanding Treasury issues with maturities of a year or longer, rose 3.16 to 1,184.10. The index fell 4.31 points in 1990.
In the tax-exempt market, the Bond Buyer index of 40 actively traded municipal bonds rose 1-32 point to 91 9-32. The average yield to maturity held at 7.47 percent, unchanged from Friday. The index is down from the 1989 closing rate of 93 14-32.