1/24/97 -- 3:27 PM

Wall Street 3pm,0481

NEW YORK (AP) - Stocks were recovering this afternoon from a steep slide with bonds that had boosted interest rates toward the highest level since September.

At 3 p.m. on Wall Street, the Dow Jones industrial average was down 32.33 at 6,723.42, rebounding from a 93 1/2-point early-afternoon slide. On Thursday, a late barrage of profit-taking turned a 56-point gain by the Dow into a 94-point loss in the second busiest session in U.S. stock market history.

Broader measures were also trimming their losses this afternoon.

Declining issues still outnumbered advancers today by more than a 2-to-1 margin on the New York Stock Exchange, where volume came to 451.06 million shares, well below Thursday's hectic pace.

The Standard & Poor's 500 list was down 3.06 at 774.50, and the NYSE composite index was down 2.16 at 406.99.

The Nasdaq composite index was down 12.75 at 1,365.62, and the American Stock Exchange composite index was down 1.58 at 588.11.

Stocks opened with modest losses, but then fell sharply when bonds turned lower, boosting interest rates.

Bond prices were hurt by supply pressures from this week's actions of new Treasury bonds and a weakening dollar, which makes the payoff on U.S. securities less attractive in foreign currencies.

As bonds fell today, the yield on the 30-year Treasury bond - a key determinant of borrowing costs that has surged in recent weeks amid inflation jitters - rose as high as 6.92 percent from late Thursday's 6.86 percent. The yield hasn't finished a day at that level since late September.

But stocks rebounded in the afternoon as Treasury prices improved slightly and the long-bond yield eased to 6.89 percent

Declining bond prices also sent stocks plunging Thursday afternoon, abruptly ending the Dow's first trip above 6,900 and the denying other widely watched measures the latest in a stream of new highs.

``Interest-rate fears just caught up with the market,'' said Brian Belski, technical analyst at Dain Bosworth in Minneapolis. ``We haven't seen this level in interest rates in a while.''

The Dow's biggest decliners were DuPont, down 3 5/8 at 103 7/8; Eastman Kodak, down 2 1/4 at 86 1/4; and General Electric, down 1 1/8 at 103.

Helping cushion the Dow's fall was Alcoa, up 1 1/2 at 68 3/4, and General Motors, which was up 1 1/8 at 63 after The Wall Street Journal reported the automaker may boost its dividend and approve a stock buyback.

The technology-laden Nasdaq was weighed down by Cascade Communications, which plunged 22 3/8 to 41 3/4 as late Thursday's otherwise strong earnings report left investors worried about slowing growth for the digital switching technology concern.

Overseas, Tokyo's Nikkei stock average fell 1.2 percent, Frankfurt's DAX index fell 1.2 percent and London's FT-SE 100 fell 1.2 percent.

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