A string of six winning months in mid-2003 was the Dow's strongest period since the October 2002 low. But the Dow, the best known of the market indicators, is virtually unchanged since the beginning of 2004.

"You can understand why people are hesitant to put money in the stock market, and you can't blame them," said Chicago-based money manager Carl Birkelbach.

On the other hand, he said, resilient corporate profitability and hoards of cash in low-yielding accounts represent the prospect for continued stock market strength.

Speaking of low yields, the benchmark yield on 10-year Treasury notes slipped early in the session to touch the closely watched 4 percent mark, but reversed course sharply to close higher for the day, at 4.09 percent.

The monthly auction of $22 billion of 2-year Treasury notes was well-received. The yield awarded was 3.61 percent, down from 3.65 percent at the April auction of 2-year notes.

New York Stock Exchange trading volume reached 1.31 billion shares. Nasdaq trading volume totaled 1.48 billion shares.

Losers topped winners by about a 2-1 ratio among NYSE and Nasdaq stocks.

The dollar advanced, as a Chinese official downplayed chances that China would revalue its currency, the yuan, upward against the dollar anytime soon, as White House officials have insisted.

Local news: Morgan Stanley boosted its investment rating on telecommunications equipment supplier Tellabs, Naperville, to "equal weight" from "underweight." Shares were unchanged, at $7.98.

Chicago-based investment research firm Morningstar dropped 90 cents, to $22.16. Late Tuesday, the company disclosed that the Labor Department had served a subpoena for information from its unit that advises company retirement programs.

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bbarnhart@tribune.com