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Spokane, Washington  Est. May 19, 1883

Technology, Retail Lead Late Rally

Associated Press

Technology and retail shares led a late recovery Monday as the stock market put on another resilient display even as the interest-rate backdrop lost a little more of its sparkle.

The Dow Jones industrial average rose 4.41 to 8,198.45, edging into positive territory just before the close after erasing an early 60-point deficit.

Broader stock indicators posted slightly bigger gains, led by the technology-heavy Nasdaq composite index, which closed at a record high for the fourth consecutive session.

“It’s just amazing. This market won’t stay down,” said Thomas McManus, chief U.S. investment strategist at NatWest Markets, noting the two-session pullback in the bond market.

Bonds slipped amid lingering inflation worries from Friday’s economic data, as well as concerns the market will have difficulty absorbing new government bonds from this week’s Treasury auctions.

The spillover concerns about Friday’s news of rising raw material prices overshadowed Monday’s economic data, which offered some support for the argument that economic activity has been slowing enough to keep inflation in check.

The Commerce Department reported Monday that construction spending unexpectedly tumbled 1.1 percent in June, the worst showing in six months. The May reading, however, was revised sharply upward to an increase of 0.3 percent from the initial estimate of a 1.8 percent drop.

Some of the stocks that moved substantially or traded heavily Monday:

NYSE

British Airways, down 6-3/8 at 99-3/16.

The London-based airline reported a 47 percent improvement in profits for the three months ended June 30, but warned that a dispute with flight attendants will cost more than expected.

U.S. Filter, up 2-3/8 at 33 11/16.

The water treatment concern acquired about 50,000 acres of land and water rights from affiliates of the Bass family of Texas for 8 million shares and warrants to buy 1.2 million more. U.S. Filter, based in Palm Desert, Calif., also reported earnings that were in line with expectations.

NASDAQ

Sullivan Dental Products, up 4 at 26-1/4.

Henry Schein Inc. of Melville, N.Y., agreed to buy Sullivan for stock valued at about $318 million, or $28.67 a share. Schein is to swap 0.735 share of its stocks for each share of Sullivan.

Alpha-Beta Technology, down 4-1/16 at 6-3/4.

The company announced disappointing results from a clinical test of Betafectin, a drug designed to fight post-surgical infection.