August 10, 1983

The Army's Chief of Staff says that worldwide American military commitments, including new commitments in Central America, Chad and the Persian Gulf, threaten to stretch the Army and the other armed forces thin. ''Traditionally, we've had a range of contingency needs that probably exceed the force capabilities that we've been able to generate,'' the Chief of Staff, Gen. John A. Wickham Jr., said in a conversation with reporters Monday. ''That probably applies now.'' Forty-three percent of the Army is now deployed abroad, from West Germany to South Korea, with detachments in Honduras, the Sinai Peninsula and elsewhere in Egypt.

Libya was reported to be moving tanks and ground forces toward Chad's northern settlement of Faya-Largeau today, and Western sources said a Government garrison there was under increasing threat. ''The game is over'' for the loyalist forces, a Western intelligence source said, if Libya continues to intensify its efforts to topple the Western-backed Government of Hissen Habre. The Government is waging a civil war against forces of Chad's former leader, Goukouni Oueddei. The Libyan leader, Col. Muammar el-Qaddafi, supports Mr. Goukouni. In Paris, the Defense Ministry announced that at the request of Mr. Habre, it was sending 180 paratroopers to Chad to serve as instructors for Government forces. The announcement stressed that the troops, who are based in the Central African Republic, would be forbidden to take part in direct combat operations.

Applications for home mortgages have trailed off sharply in recent weeks as interest rates have increased. Officials in the construction and lending industries agree that the decline threatens the recovery of the housing market. But beyond that, there is sharp disagreement as to how much harm may result. A few economists believe a small downturn might help stabilize the market in the long run. But most are concerned that a still-fragile recovery may be prematurely choked off.

IN the last five years, Italy has upstaged France as the inspiration for fashionable food trends in the United States. New and expensive restaurants and fancy-food shops, favored by a status-conscious clientele, offer heretofore unknown pasta and risotto variations, cheeses, wild mushrooms, game dishes, olive oils and exotic vinegars that have taken the play away from some France's most esteemed products. It seemed time, therefore, to go to the source and sample these foods, not only to ascertain how well they have traveled but also to find clues to future culinary trends. So for six weeks, from early June to the end of July, I traveled from the southwestern corner of Sicily to Valtellina in the Alps, visiting not only restaurants, but also the great outdoor and indoor markets. After such lengthy, high-caloric research, it is gratifying to report that a number of products, dishes and meals in Italy were indeed wonderful. Tree-ripened fruits, gelati, coffee, breads in bakeries (if not in restaurants), the intrinsic quality of pasta and rice and the freshness of most seafood are still far superior to our own.

Markets Stock prices were mixed at the close after a late rally erased early losses. The Dow Jones industrial average finished up 5.21 points, to 1,168.27, after having been down more than 2 points at 3:30 P.M. On the overall market, however, declines outnumbered advances by 847 to 726. Turnover on the Big Board expanded to 81.4 million shares from 71.5 million shares the day before. (Page D1.) Prices for Treasury notes and bonds rose modestly. Investors were attracted by prices near the lowest levels since last September. (D9.) The dollar was mixed, while gold prices fell $2 an ounce, to $409.50, in New York. (D14.) Grain futures prices fell. (D14.)