FINANCIAL MARKETS : Dow at High on Earnings, Dollar Gains

Blue-chip stocks were propelled to new highs Thursday on the heels of healthy corporate earnings reports and a rebounding dollar.

But the broader market wasn’t as strong, despite another decline in bond yields.

The Dow Jones industrial average jumped 23.17 points to a record 4,230.66, topping the old high of 4,208.18 reached April 13.

The Dow was driven by shares of IBM, which surged 1 7/8 to a 52-week high of 89 on a surprisingly robust first-quarter earnings report, and by gains in major oil stocks, which responded to recent strength in oil prices.

Overall, though, rising stocks outnumbered losers by just 12 to 10 on the New York Stock Exchange, where the composite index edged up 0.37 point to 273.09. It remains below its recent peak of 275.00.

The Nasdaq composite index of mostly smaller stocks added 2.46 points to 819.01 after diving Wednesday. It is 1.6% below its recent peak of 832.64.

Some traders said blue-chip shares are being helped by technical trading related to today’s monthly expiration of key stock index options and options on individual shares.

Even so, analysts note that corporate America’s generally bullish first-quarter earnings reports have helped buoy the market recently. With the dollar’s decline halted on Thursday--if temporarily--more investors may have been able to concentrate solely on earnings.

The dollar gained partly on hopes that the G-7 industrial countries will propose a credible plan to support the greenback when finance ministers meet next week.

The dollar closed in New York at 1.3855 German marks, up from 1.3705 on Wednesday, and at 83.25 Japanese yen, up from 81.25.

The rally wasn’t disturbed by German Chancellor Helmut Kohl’s surprisingly angry remarks in a TV interview. He called the U.S. policy toward the dollar unacceptable.

Strength in the Mexican peso also may have indirectly helped the dollar. The peso closed at 5.96 to the dollar, better than the target rate of 6 pesos set by the Mexican government.

With the dollar gaining, U.S. bond yields continued to ease. The 30-year Treasury bond yield slipped to 7.34% from 7.36% Wednesday and shorter-term yields also were lower.

Interest rates got another downward push from the Federal Reserve Bank of Philadelphia’s regional economic report, which said manufacturing activity in that area declined in March to the lowest level since February, 1991. The Philadelphia report often foreshadows national trends.

Wall Street continues to believe that growth will slow enough to keep interest rates and inflation low but not enough to bring on recession. However, some economists think either business activity or inflation--or both--could pick up this summer.

Among Thursday’s highlights:

* Stocks gaining on earnings reports included Compaq, up 3 5/8 to 35 3/4; Allied Signal, up 7/8 to 39 3/4; PPG Industries, up 1 to 38 3/8, and Schlumberger, up 3 5/8 to 63 1/2.

* Oil stocks rose despite some profit taking in crude oil futures. Texaco climbed 1 1/2 to 67 7/8, Chevron added 1 1/4 to 46 3/4 and Mobil jumped 2 to 91 3/4.

* On the downside, health care stocks were under pressure for a second day. HMO stocks, slammed Wednesday over worries about price wars, fell further. Humana lost 1 to 20 7/8, PacifiCare Class A dropped 1 to 66 and U.S. Healthcare plunged 3 15/16 to 29 5/16.

Also, Sunrise Medical slumped 4 1/2 to 30 1/4 after the health equipment maker reported lower-than-expected earnings. It cited industry cost pressures.

In foreign markets, London’s FTSE-100 index added 4.6 points to 3,174.7, while Tokyo’s 225-share Nikkei average jumped 266.98 points, or 1.6%, to 16,643.06, responding to the weaker yen.

In Mexico City, the Bolsa index surged 37.77 points to 1,830.52 as the peso strengthened.

Market Roundup, D6