Late Rebound Pares Dow’s Loss To 58 Points

Stocks bounced off a familiar safety net Thursday, finishing only modestly lower after falling sharply to a level that has repeatedly proven too enticing for bargain hunters.

The Dow Jones industrial average ended the day down 58.30 at 7,660.98. An earlier loss of 138 points briefly put the Dow under 7,600, a psychological barrier that has now served as a market bottom three times in the past month.

Broader sectors also cut their losses in the afternoon rebound, with the Nasdaq market managing to squeeze out a small gain.

The session started on a troubling note with the release of more data suggesting upward pressure on wages - a key force behind inflation - and another flurry of discouraging developments concerning company profits.

“There’s great nervousness because the retail sales figures for August (to be released today) are likely to be quite strong,” said Sherry Cooper, chief economist at Nesbitt Burns Securities of Chicago. “And the producer price index, which has fallen for seven consecutive months, will probably show an uptick for August.”

Declining issues outnumbered advancers by an 8-to-5 margin on the New York Stock Exchange, where volume was very heavy at 574.57 million shares as of 4 p.m., up from 516.68 million on Wednesday.

Some of the stocks that moved substantially or traded heavily Thursday:

NYSE

Corning, down 5-3/8 at 42.

The company lowered its full-year profit estimate, blaming disappointing growth in its optical fiber and cable businesses. Corning, which also makes glass products, said it expects that trend to continue for the rest of the year.

Pillowtex, up 4-1/2 at 28-1/4.

The Dallas-based company agreed to acquire rival home textile manufacturer Fieldcrest Cannon for $34 a share, or about $400 million, in cash and stock.

Rohr, up 11/16 at 28-1/2.

The aircraft parts maker confirmed market rumors that it is holding merger talks. Rohr, based in Chula Vista, Calif., said the deal currently being discussed values the company’s stock at $30.25 a share.

NASDAQ

Ascend Communications, down 2-3/16 at 37-13/16.

Several leading brokerages lowered their earnings estimates for the computer networking concern, the Dow Jones News Service reported. Some analysts are viewing an Ascend price promotion as a sign that the Alameda, Calif.-based company needs to boost sales to meet earnings projections.

Adobe Systems, up 3-1/2 at 44-1/2.

The software maker expects its third-quarter earnings to exceed analysts’ estimates. Adobe said it enjoyed a rise in revenue from product shipments in the quarter, which ended Aug. 29.