Dow off 79.79

Associated Press

NEW YORK - Blue-chip stocks resumed their slide today, as a strong report on U.S. employment solidified Wall Street's belief that the Federal Reserve will raise interest rates later this month.

The Dow Jones industrial average fell 79.79 to close at 10,714.03, erasing much of its 119-point gain yesterday. The blue-chip index ended a choppy week 58.08 points higher, a gain of 0.5 percent.

Broader stock indicators like the Standard & Poor's 500 index and the Nasdaq composite index fell modestly today, capping a week of steep losses. The S&P 500 fell 13.42 to 1,300.29, and the Nasdaq lost 17.86 to 2,547.97.

Decliners led advancers by a 2-to-1 margin on the New York Stock Exchange, with 1,969 down, 970 up and 547 unchanged. NYSE volume was 701.66 million shares vs. 862.07 million yesterday.

The NYSE composite index fell 6.35 to 611.04, but the American Stock Exchange composite index rose 1.83 to 777.92. The Russell 2000 index fell 1.71 to 428.04.

Bond prices fell sharply on the report. The 30-year Treasury bond fell 1 18/32, or $15.63 per $1,000 face amount, to a price of 87 17/32. The drop marked the biggest decline since May 14, when a report showed a jump in consumer prices. The bond's yield rose to 6.15 percent from 6.04 percent late yesterday. Yields on two-year notes, among the securities most sensitive to Fed policy, rose 13 basis points to 5.68 percent.

Stock and bond prices tumbled after the Labor Department reported employers added a larger-

than-expected 310,000 jobs to their payrolls in July and that average hourly earnings, a key gauge of inflation pressures, rose 3.8 percent from a year ago.