Updated from 4:04 p.m. EDT

The trading session was fairly volatile Thursday, and the major averages spent time on both sides of the flatline, but by the end of the day blue-chips and tech stocks emerged with modest gains.

The Dow Jones Industrial Average finished with a gain of 74.83 points, or 0.9%, to 8818.14. The Nasdaq rose 10.71 points, or 0.8%, at 1345.01, and the S&P 500 climbed 10.62 points, or 1.2%, to 930.24.

Stocks opened the session higher, building on the gains from the prior session, but blue-chips and tech stocks quickly pulled back before again going positive.

Solid quarterly reports from chain-store operators like Target ( TGT), Nordstrom ( JWN) and Sharper Image ( SHRP) sent the retail sector higher. The Dow Jones U.S. Retail Index was up 3.4%.

Among other companies on the move, automaker Ford Motor ( F) gained 2.3% to $11.61 after Merrill Lynch issued positive comments on the company, saying it "continues to believe that Ford's fundamentals are bottoming this year, the market's liquidity concerns are excessive, and that the stock is oversold."

Brocade Communications ( BRCD) posted a solid third quarter and reaffirmed its fourth-quarter earnings outlook, saying it remains optimistic on the future of computer data storage networks. The stock rose 6% to $15.96.

In the drug sector, Forest Labs ( FRX) said the Food and Drug Administration has approved its Lexapro drug, a treatment for chronic depression. The company said the drug is a more potent form of its antidpressant Celexa. Forest climbed 5% to $73.24.

But the market wasn't short on negative news. UAL ( UAL), the parent company of United Airlines, said after the close Wednesday that it may be forced to seek bankruptcy protection under Chapter 11 as early as the fall if it can't drastically reduce expenditures.

The airline has been beaten down by an industrywide slump in the travel market since the Sept. 11 terrorist attacks. UAL's shares slid as low as $1.90 earlier in the session, but ended up 10% at $2.70. Earlier this week, US Airways ( U) filed for bankruptcy, and American Airlines, a unit of AMR ( AMR), set plans to cut several thousand jobs and reduce capacity.

Most of the several hundred U.S. companies required to certify their financials with the Securities and Exchange Commission met Wednesday's deadline without incident. There were a few glitches along the way, including the filings from media giant AOL Time Warner ( AOL).

AOL filed its certification at the deadline, but the company disclosed that three business deals totaling $49 million may have been inappropriately recognized at its America Online unit. The stock was the most heavily traded issue on the New York Stock Exchange , advancing 7% to $11.86.

Meanwhile, Gemstar-TV Guide ( GMST) said it will delay its second-quarter financial results in order to re-evaluate the way it recognizes revenue.

The company, which provides interactive program guides for cable television, plans to restate its 2001 results to reverse $20 million in sales, but said the restatement won't affect its full-year loss or cash flow. Gemstar also said it is considering a restructuring of its senior management staff. Shares were up 6% to $3.54.

Goldman Sachs pared its earnings and revenue outlooks on four major computer hardware companies, saying the group is still contending with the slowdown in technology. Analyst Laura Conigliaro cut her 2003 revenue estimates on Hewlett-Packard ( HPQ) and IBM ( IBM). Both stocks were higher.

Conigliaro also lowered her investment ratings on storage equipment maker EMC ( EMC) and Unix-systems maker Sun Microsystems ( SUNW) to market outperform from its recommended list. Shares of EMC moved higher, and Sun dropped.

Standard & Poor's said it will remove Vitesse Semiconductor ( VTSS) from its benchmark S&P 500 and replace it with Travelers Property Casualty ( TAP.A), citing Vitesse's low share price and a market capitalization that ranks last in the index.

The changes will take effect at the close of trading Aug. 20. Vitesse lost 8% to $1.26, while Travelers gained 1% to $16.

In economic news, the Labor Department said initial jobless claims rose to 388,000 in the week ended Aug. 10 compared with a revised 382,000 the previous week. Economists were expecting the number of first-time jobless insurance claims to come in at 378,000.

Separately, the Federal Reserve said industrial production rose 0.2% in July, compared with a 0.7% increase in June. Capacity utilization ticked up to 76.1% from 76%. The results were in line with expectations.

U.S. Treasury issues were lower around 4 p.m. EDT. The 10-year note was down 15/32 at 101 18/32, yielding 4.181%. The long bond was down 26/32 to 105 29/32 and yielding 4.985%.

In Europe, London's FTSE 100 gained 3.8% at 4328, while Germany's Xetra DAX was up 2.1% at 3666. Japan's Nikkei 225 rose 1.6% to 9796, and Hong Kong's Hang Seng closed up 2.6% to 10,220.

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