Dow edges lower, breaking a 4-day streak

NEW YORK - A September stock rally faltered Tuesday as worries about Europe's economy returned.

The Dow Jones industrial average and the Standard & Poor's 500 index both closed with slight losses, breaking a four-day winning streak. Stocks are still up strongly this September, historically a weak month for the market.

Stocks had edged higher for much of the day after positive reports on U.S. retail sales and business inventories, but retreated in the final 10 minutes of trading as investors' enthusiasm waned.

Disappointing news from overseas hung over the market all day.

European markets ended barely higher after reports that German investor confidence fell sharply in September and industrial production unexpectedly stagnated during July in the countries that use the euro.

Stocks in Tokyo also fell after the yen touched another 15-year high against the dollar, which is bad news for Japanese exporters because it makes their goods more expensive to overseas customers.

In other signs that investors remain cautious, gold climbed to another record and Treasury prices rose, sending interest rates lower.

The Dow fell 17.64, or 0.17 percent, to close at 10,526.49 and the S&P 500 lost 0.8 point, or 0.1 percent, to end at 1,121.10. The Nasdaq edged up 4.06, or 0.2 percent, at 2,289.77.

Signs of modest growth have been enough to get traders to put more money into stocks in September.

September is usually a weak month for stocks, but this year has been an exception. Even after Tuesday's losses the Dow is still up 5.1 percent in September, but 6.1 percent below its 2010 high. For the year to date, it's up 0.9 percent.

The Commerce Department said Tuesday that retail sales rose in August at their fastest pace in five months and slightly beat forecasts. The modestly higher growth is in line with economic reports over the last two weeks indicating that the economy continues to expand, though at a sluggish pace.

Retail stocks including Macy's Inc. and J.C. Penney Co. rose after the retail sales report. Electronics retailer Best Buy Co. also jumped after the company reported income that easily topped forecasts and raised its full-year outlook.

In another encouraging sign on the economy, business inventories jumped in July by the most in two years and business sales rebounded after two months of declines.

The upturn followed months of weak sales as people remain worried about keeping their jobs.

Gold hit a record earlier in the day, climbing as high as $1,276.50 an ounce, before settling at $1,271.70.

European stock indexes rebounded after initially falling on the German and European economic reports. Britain's FTSE 100 rose less than 0.1 percent, while Germany's DAX index gained 0.2 percent. France's CAC-40 rose 0.2 percent.

Japan's Nikkei stock average fell 0.2 percent, getting the global trading day off to a sluggish start.

Macy's rose 60 cents, or 2.9 percent, to $21.65, while J.C. Penney climbed $1.66, or 7.4 percent, to $23.99. Best Buy jumped $2.08, or 6 percent, to $36.73.