NEW YORK - Stocks ended barely higher today, sliding into the close after rallying with the bond market, where interest rates fell on the latest evidence that inflation has remained tame. Dow gains 11.95, just shy of record
The Dow Jones industrial average, which rose by as much as 77 points in the morning, gained 11.95 points to close the day at 7,286.16, less than 7 points shy of Monday's record high. It was the second straight session that the blue-chip barometer broke past 7,300 only to fall below that mark by the close.
Advancers led decliners by nearly a 3-to-2 margin on the NYSE, with 1,491 up, 1,017 down and 837 unchanged. NYSE volume was 498.75 million shares vs. 489.71 million yesterday.
Broad-market measures also faltered after an early jump with the bond market, which rallied after the Labor Department reported that wholesale prices paid to farms, factories and other producers fell 0.6 percent in April, the largest drop in nearly four years and the fourth straight decline.
The New York Stock Exchange index rose 1.63 to 435.60, barely topping Monday's record close at 435.57. But the Standard & Poor's 500-stock list rose 2.91 to 836.04, about 1 1/2 points below Monday's record.
The Nasdaq composite index rose 1.96 to 1,335.55, and the American Stock Exchange composite index rose 2.37 to 581.97.
Bond prices immediately shot up after the inflation figures were released, pushing down interest rates in money markets. The yield on the 30-year Treasury bond - a key influence on borrowing costs - fell as low as 6.85 percent in the morning, down from 6.92 percent late yesterday. By late afternoon, the yield stood at 6.88 percent.
Economists had been expecting a modest 0.1 percent drop in wholesale prices. The much larger decrease bolstered hopes that the Federal Reserve won't raise interest rates again when they meet Tuesday.
The Fed, trying ease inflationary pressures by slowing the pace of borrowing and spending, raised one of its key lending rates in late March. But stocks fell sharply as investors worried that the central bank would act raise rates repeatedly, putting a big dent in company profits.
Over the last month, however, signs have emerged that economic growth is moderating enough to dampen inflationary pressures without higher interest rates, spurring a sharp rebound in the financial markets.