Blue-Chip stocks ended higher as news of a drop in US exports in July reinforced the view that the economy was slowing, which should close the door on any interest rate hike by the Federal Reserve in the near term. The Dow Jones industrial average closed up 36.28 points at 7,922.72 after profit taking cut into an early rally of nearly 135 points. The Nasdaq composite index was up 3.55 at a w high of 1,670.02.

In the broader market, advancing issues beat declines 16-11 on active volume of 571 million shares on the New York Stock Exchange.

The outlook for stable interest rates rekindled investors' affection for large, name-brand stocks.

Analysts said the market's volatility stemmed in part from Friday's "triple-witching" expiration of options and futures contracts. They said the Dow could now be set for an assault on last month's record close of 8,259.31, as investors flock back to blue chips.