Arcing across coil terminals

The point gap should be .017''

Before you push in the coil wire, pull the boot back. That way you can feel the coil wire 'snap in'. then push the boot on.

I'd replace the coil. ---- And get a higher quality dist. cap and rotor from the same manufacturer. The old tan colored Mopar caps had vertical ribs on the inside. And as somebody said, replace the coil wire. It may have been damaged.