After early fluctuation, the market achieved moderate gains by afternoon. The atmosphere was dull despite encouraging reports on consumer spending and manufacturing.

The Dow Jones industrial average closed up 41.61, or 0.4 percent, at 9,415.82, according to preliminary calculations. For the week, the Dow gained 0.7 percent.

The Nasdaq composite index rose 10.40, or 0.6 percent, to 1,810.58. The Standard & Poor’s 500 index advanced 5.18, or 0.5 percent, to 1,008.02. For the week, the Nasdaq climbed 2.6 percent and the S&P gained 1.5 percent.

While trading has been slow throughout August as traders take summer vacations, the major indexes easily ended the month higher. The Dow and S&P posted their sixth straight winning month, while the Nasdaq had its seventh straight monthly gain.

It was the fourth straight winning week for the Dow and the third for the Nasdaq, S&P and Russell 200 index.

Market observers were encouraged that Wall Street was able to advance again, this time in the doldrums of August.

"This is potentially good news ... because if we now see the top of the range begin to act as support, we increase the chance of breaking out to the top side as traders return to the market," said Chris Johnson, manager of quantitative analysis at Schaeffer’s Investment Research in Cincinnati.

There was a lot of economic news today, most of it positive.

Federal Reserve Chairman Alan Greenspan sought to reassure the market that the Fed aimed to guard against even remote risk of deflation.

In a speech in Jackson, Wyo., Greenspan defended the Fed’s recent worries about deflation, which caused some volatility on Wall Street. He said it was sometimes necessary for the Fed in its interest rate policy to take out an insurance policy "against the emergence of especially adverse outcomes."

Before the market opened, the Commerce Department reported consumers boosted spending 0.8 percent in July as the latest tax cut left people with extra cash.

The increase in spending last month was the largest since March and followed a sizable 0.6 percent advance in June. July’s spending figure matched economists’ expectations. Consumer spending accounts for two-thirds of the U.S. economy.

Later, the Purchasing Management Association of Chicago said its index of area business activity rose to 58.9 in August on a seasonally adjusted basis from 55.9 in July. It was the fourth straight month that the business barometer signaled expansion.

But the University of Michigan’s report on consumer confidence indicated a slight drop in August from July, according to Dow Jones Newswires.