FINANCIAL MARKETS : Treasury Default Fears Fail to Halt Dow’s Record Pace : Markets: But bond yields and price of gold rise, reflecting concerns of some investors over impasse in Washington.

Wall Street closed mixed on Friday, with the Dow Jones industrials at a record high but most stocks falling as bond and gold markets braced for next week’s federal budget showdown.

The Dow inched up 6.14 points to 4,870.37, its third consecutive record.

However, losers outnumbered winners by 12 to 10 on the New York Stock Exchange in modest trading, taking a cue from a jump in bond yields.

The 30-year Treasury bond yield closed at 6.33%, up from 6.28% on Thursday and the highest since Nov. 1. But bond trading was extremely light, with many market players on the sidelines as the political rhetoric over the federal budget grew increasingly bitter.

Some worried investors again turned to gold, pushing the price of November gold futures up $3.30 to a three-month high of $389.60 on the Commodity Exchange.

President Clinton on Friday said he would veto legislation passed by the Republican Congress to raise the federal debt ceiling and temporarily fund government operations pending further work on a long-term balanced budget plan.

Clinton said Republicans had politicized the bills by attaching riders that he could not sanction.

Clinton’s stance set the stage for a potential shutdown of the government next week--and the possibility of the first-ever default by the U.S. Treasury.

While most big investors continue to believe that the Treasury will do whatever is necessary to avoid actual default, the rise in bond yields this week was a sign of underlying nervousness.

“Most people don’t want to trade because they don’t know what’s in store,” said Jay Goldinger at Capital Insight in Beverly Hills.

The stock market, meanwhile, has been acting much more confident all week. The Dow rose 44.80 points for the week.

“I think there’s a general feeling that an actual default is unthinkable, or that any problems would be very short-term,” said Eric Miller, Donaldson, Lufkin & Jenrette Securities’ market strategist.

Also, many investors are betting that, if the budget impasse is resolved by mid-December--with Clinton’s signature on the long-term balanced-budget plan sought by Republicans--the Federal Reserve Board will again cut short-term interest rates to help bolster the weak economy.

Among Friday’s highlights:

* Blue-chip stocks pushing the Dow higher included Alcoa, up 1 1/2 to 54 1/8; Boeing, up 1 1/4 to 71 1/4; Goodyear, up 1 1/2 to 41 3/8, and Coca-Cola, up 1 to 72 3/4.

* Major technology stocks rocketed for a second day, snapping back from a mid-week selloff. Software firm Adobe Systems surged 5 1/8 to 66 3/4 after saying European orders were rebounding.

Other winners included Hewlett-Packard, up 1 5/8 to 95; Sun Microsystems, up 4 3/4 to 89 7/8; Computer Sciences, up 3 11/32 to 71 1/2, and Seagate, up 3 1/8 to 51 5/8.

But Microsoft lost 2 1/8 to 96 7/8, Intel eased 3/4 to 68 1/4 and IBM was off 1 to 97 3/8. Tech shares’ gains overall weren’t enough to boost the Nasdaq composite index, which eased 1.72 points to 1,063.87.

* Some transportation stocks were strong. Conrail rose 2 1/2 to 68 3/8, Delta Air Lines added 5/8 to 71 1/8 and Union Pacific gained 1 7/8 to 66 1/2.

* First Interstate Bancorp jumped 2 to 134 3/4. Many analysts expect Wells Fargo to raise its bid for the bank next week, aiming to break up First Interstate’s merger agreement with First Bank System. Wells was unchanged at 215 3/8 while First Bank added 3/4 to 53 1/8.

In currency trading the dollar stabilized after diving against the Japanese yen on Thursday, in what some traders described as a selloff related to jitters over the federal budget fight.

In New York the dollar rose to 100.93 yen from 100.35 Thursday.

The Mexican peso’s stability Friday also may have helped the dollar. But in trading on Mexico City’s stock exchange the Bolsa share index got no lift from the peso. The Bolsa eased 0.99 point to 2,310.10.

In Brazil, the Bovespa stock index slumped 3.8% as the Brazilian Congress stalled in efforts to cut spending and reduce the government’s deficit.