Dow gains 7.67
to record close

NEW YORK -- The Dow Jones industrial average clung to a small gain today to set another record, but stocks turned mostly lower by the close as investors took a defensive stance before tomorrow's key economic data.

The Dow surrendered most of a 65-point afternoon gain, rising 7,67 points to 8,121.11, but that was enough to beat Thursday's record finish at 8,116.93.

Most broad-market indicators turned slightly negative over the last hour of trading, but the American Stock Exchange also managed to hold onto enough of a gain to set a new high.

Advancers barely led decliners on the New York Stock Exchange, with 1,442 up, 1,427 down and 537 unchanged. NYSE volume was 463.70 million shares, vs. 519.65 million Friday.

The Standard & Poor's 500-stock list fell 2.34 to 936.45, the NYSE composite index fell 0.87 to 485.93, and the Nasdaq index fell 4.61 to 1,564.97. The American Stock Exchange composite rose 1.55 to 639.35, beating last Wednesday's record close of 638.03.

Stocks drew support throughout the day from the bond market, where interest rates sank to their lowest level of the year amid enthusiasm for an impending budget deal in Washington.

As bonds rose today, the yield on the 30-year Treasury fell to 6.40 percent, below last Tuesday's 6.41 percent, which was the lowest finish since early December.

Trading was quiet as investors prepared for a slew of important reports due throughout the week, including tomorrow's data on second-quarter employment costs and Friday's data on July payroll and wage levels.

Investors hope those reports will reveal little increase in payroll and benefit costs, which typically constitute two-thirds of a product's price. Stocks have been rallying since mid-April thanks to a tame-inflation backdrop that has kept the Federal Reserve from boosting interest rates to slow the economy.