Banking stocks spent another directionless session in nervous trading on Wednesday after the Federal Reserve System's open market committee concluded its two-day meeting with no announcement on monetary policy.
Of the 50 largest bank stocks, about half were lower or unchanged while others managed mostly small gains.
"We appear to be in limbo," said Lawrence W. Cohn of PaineWebber Inc., New York.
The aimlessness will probably continue until Friday, he said, "when, a large body of opinion has it, new economic data will determine what the Fed does" about short-term interest rates.
Employment Data Due Out
On Friday the federal government's latest employment survey is due to be released. The June jobs report will provide fresh clues on the strength and direction of the nation's economy.
"Friday will indeed be the next possible flashpoint for action," said Frank J. Barkocy of Advest Inc.
There were several exceptions to Wednesday's dull session.
Albank Financial Corp., Albany, N.Y., was up $2.75 to $27.375 in heavy trading on takeover rumors. The company declined to comment. Similarly, Grove Bank, Chestnut Hill, Mass., was up $1.50 to $32.75 after CNBC television commentator Dan Dorfman said a buyout was possible.
Mr. Dorfman quoted banking analyst Gerard Cassidy of Hancock Institutional Equities Services as saying a deal was possible by yearend at a price of $40 to $42 per share.
Activity in banks picked up modestly as the session drew to a close, with NationsBank Corp. gaining $1 to $52.25. MBNA Corp., strong after it was added last week to Lehman Brothers' list of 10 stocks with "uncommon value," was up $1.50 to $25.375.
Bankers Trust New York Corp. shares slipped 62.5 cents to $66.125 on renewed fears about trading activities.
The worries arose after Salomon Brothers Inc. shocked Wall Street by announcing it would report a $200 million second-quarter loss after taxes. Salomon shares were off $2 to $45.50.
