Dow Record Remains Elusive

The index again ends just short of setting an all-time high.
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Updated from 4:19 p.m. EDT

The

Dow Jones Industrial Average

once again tried to establish a record high Thursday, but its bid fell just short as government data hinted that an economic slowdown could be on the horizon.

Ever so briefly, the Dow traded above its best-ever close. Investors, though, had to settle for a gain of 29.21 points, or 0.25%, to 11,718.45 -- roughly 5 points from setting a new benchmark.

The

S&P 500

rose 2.56 points, or 0.19%, to 1339.15, and the

Nasdaq Composite

tacked on 6.63 points, or 0.29%, to 2270.02.

About 2.23 billion shares changed hands on the

New York Stock Exchange

. Advancers beat decliners by a 9-to-7 margin. Volume on the Nasdaq was 1.82 billion shares, and winners edged losers 8 to 7.

"The market is struggling with the new high," said Barry Hyman, equity market strategist with EKN Financial. "But, the rotation from energy to technology is still happening. There has been tremendous improvement to the psychology of the market, as it seems the

Federal Reserve

made the right decision in keeping rates unchanged. The support for the market is there to prevent any major selloffs."

September is historically a weak time for the major indices, but this time around the Dow is higher by 337 points, or 3%, with only one session left before the month ends. The S&P 500 has gained 35 points, or 2.7%, and the Nasdaq has collected 86 points, or 3.9%.

With many traders worrying less about additional Fed rates hikes, they're now focusing their worries on whether the economy is in danger of cooling too rapidly. Before the opening bell, the Commerce Department said its final data on second-quarter gross domestic product showed growth declining to a 2.6% rate from the previous 2.9% pace.

The final chain deflator, a key measure on inflation, was left unchanged at 3.3%, matching economists' estimates.

However, the closely watched core inflation measure came in at 2.7%, down slightly from the preliminary report. The year-over-year figure was revised to 2.2%, down from 2.3%.

"The final revisions of second-quarter GDP had inflation components moving down slightly," said Peter Cardillo, chief market strategist with S.W. Bach & Co. "Even though inflation pressures are elevated, we saw modest growth. Hopefully this will keep the bulls in charge, as momentum buying will continue in the last days of the third quarter."

Also on the economic front, the Labor Department said initial jobless claims fell by 6,000 to 316,000 for the week ended Sept. 23, in line with forecasts.

General Motors

(GM) - Get Report

was the Dow's best gainer after the company said billionaire shareholder Kirk Kerkorian plans to buy up to 12 million more shares of the automaker in an attempt to force a three-way alliance with Renault and Nissan. GM climbed by 78 cents, or 2.4%, to $33.06.

Rival

Ford

(F) - Get Report

announced after the bell that it will cut 2,000 added jobs in the U.S. and Canada in a cost-reduction effort. Shares finished the session higher by 16 cents, or 2%, at $8.16.

Dow component

Hewlett-Packard

(HPQ) - Get Report

said general counsel Ann Baskins has resigned, effective immediately. Chief Executive Mark Hurd said that it was a "very hard decision for

Baskins, but by doing so she has put the interests of H-P above her own and that is to be commended."

The announcement came as a House of Representatives subcommittee convened on Capitol Hill for a hearing regarding the secret effort to try and determine who on the board was leaking confidential information to reporters.

Baskins' exit comes nearly a week after Chairwoman Patricia Dunn resigned following H-P's probe. Two other executives also stepped down this week. Shares of H-P tacked on 58 cents, or 1.6%, at $35.97, but have fallen more than 2.5% since the beginning of the month.

Also on the Dow,

McDonald's

(MCD) - Get Report

closed lower even after A.G. Edwards raised its stock price target to $44 from $40. The firm reiterated a buy rating, citing industry-leading fundamentals, improving yield and an enhanced image worldwide. The firm raised its full-year earnings estimate to $2.30 a share from $2.27 and its 2007 estimate to $2.50 a share from $2.42. McDonald's was off 23 cents, or 0.6%, to $39.59.

Microsoft

(MSFT) - Get Report

was edging down after it announced its Zune portable media player will be made available on Nov. 14 for a price of $249.99. The online Zune marketplace will offer a subscription that allows unlimited downloads for about $15. The Zune player will come preloaded with audio files and video clips. Shares dipped 4 cents, or 0.2%, to $27.40.

Amgen

(AMGN) - Get Report

said late Wednesday that the Food and Drug Administration approved its colorectal cancer drug Vectibix, a product for which the company has high hopes. Analysts believe the drug could put pressure on sales of Erbitux, the colon cancer treatment from

ImClone Systems

(IMCL)

and

Bristol-Myers Squibb

(BMY) - Get Report

.

Amgen finished down 59 cents, or 0.8%, to $71.55. ImClone gave back 24 cents, or 0.8%, to $28.51, and Bristol-Myers was off 15 cents, or 0.6%, to close at $24.85.

On the research front, ThinkEquity downgraded

Nvidia

(NVDA) - Get Report

to sell from buy and dropped its price target by $5 to $25. The firm also cut

Advanced Micro Devices

(AMD) - Get Report

to sell from buy and reduced its target price by $10 to $20. In both cases, the firm cited what it sees as a slowdown at

Dell

(DELL) - Get Report

.

Meanwhile, Citigroup raised it stock price target for

Intel

(INTC) - Get Report

to $24 from $23, while also upping rival AMD's stock price target to $31 from $27.50. Intel rose 1.9% to $20.77, and AMD lost 1% to $25.07.

Elsewhere, crude oil, whose rise of nearly $2 a barrel stalled a Dow rally Wednesday, pushed to $64 before retreating to close down 20 cents at $62.76.

Gold rose $7.60 to close at $610.90 an ounce, and silver was up 3 cents at $11.73 an ounce. Among individual names,

Goldcorp

(GG)

ended higher by 0.3%, while both

Glamis Gold

(GLG) - Get Report

and

Barrick Gold

(ABX)

slipped 0.6%.

Overseas, Europe's equities were mixed. London's FTSE 100 added 0.7% to 5971, and Frankfurt's Xetra DAX lost 0.1% to 5989. Asia's shares inched higher, with Tokyo's Nikkei ending up 0.5% to 16,024 and Hong Kong's Hang Seng rising 0.1% at 17,530.