Dow Fights to a Record Despite Broad Pullback

The Dow Jones industrial average barely preserved its record-setting streak, but most stock indexes pulled back Friday as a second day of declines in Asia led investors to take profits before a long holiday weekend.

The Dow rose 0.50 point to 8,370.10 as a last-minute push wiped out the remnants of an early 57-point slide. Though slight, the gain meant a fourth-straight record close for the Dow, which before Tuesday hadn’t set foot in record territory for six months.

Broader measures, however, finally succumbed to profit-taking after two days of late turnarounds.

Still, most of the declines were fairly modest, and smaller-company shares, the laggards in Wall Street’s three-week rally, managed small gains.

“The market’s resilience is remarkable considering the type of week we’ve had,” said Arthur Hogan, senior trader at Morgan Stanley Dean Witter.

The Dow, which rose 180.61 points for the week, has now gained 670 points in three weeks, transforming an early new year’s loss of 4% into a gain of nearly 6%.

Wall Street was weighed down at Friday’s open by another shaky day in Asia, with the main stock indexes in Hong Kong and the Philippines each dropping 3.3%. In Tokyo, stocks fell 2.2% amid growing worries that an upcoming stimulus package won’t do enough to shore up Japan’s economy.

As they had the previous two days, however, bargain hunters quickly moved to take advantage of the early decline, limiting the day’s losses.

“Whenever the market dips, there seems to be enough resilience to lift it back up,” said Robert Freedman, chief investment officer for the John Hancock Funds in Boston, noting a report earlier this week suggesting that the flow of money into mutual funds has picked up since late January. “There’s a lot of cash coming in, and fund managers are afraid of missing a move higher.”

The Standard & Poor’s 500-stock index fell 4.05 points, or 0.4%, to 1,020.09, and the New York Stock Exchange composite index fell 1.33 points, or 0.3%, to 531.28. On Thursday, both measures closed at record highs for the seventh time in nine sessions.

The technology-heavy Nasdaq composite index fell 3.92 points, or 0.23%, to 1,710.42, but still boasts an 8.5% gain for the last three weeks.

Declining issues outnumbered advancers by a 10-to-9 margin on the NYSE, with a volume of 536.39 million shares, the second-smallest tally of the new year.

The best-known small-company indicator, the Russell 2,000 index, rose 1.89 points, 0.42%, to 454.29.

Among Friday’s highlights:

* The Dow’s biggest gainers were McDonald’s, up $1.81 to $53; Caterpillar, up $1.50 to $53.50; Disney, up $1.31 to $111.44; and Boeing, up $1.13 to $50.38.

* Among leading Nasdaq stocks, Intel fell $1.19 to $83.81, and Microsoft dipped $1.25 to $157.50.

* Banking stocks fell on concern that profit growth will slow this year and the stocks will under-perform the market. Citibank lost $2.50 to $125.81, and NationsBank gave up 88 cents to $64.31.

Market Roundup, D4