Blue Chips’ Record Run Comes to End : Markets: A selloff in technology shares, along with the ‘triple witching’ effect, pushes the Dow back down under 4,800.

Blue-chip stocks closed lower Friday as a deep selloff in technology shares snapped the market’s three-day run into record territory.

The Dow Jones industrial average ended 4.23 points lower at 4,797.57, retreating from Thursday’s record close of 4,801.80.

For the week, the index ended with a solid gain of 96.85 points, buoyed by mild inflation data that revived hopes for an interest rate cut at the Federal Reserve Board’s policy-setting meeting Sept. 26.

Bond yields seesawed after a report that industrial output grew 1.1% in August gave traders and investors mixed economic signals.

The yield of the benchmark 30-year government bond edged up to 6.48% from 6.46% late Thursday. The two-year note’s yield rose 3 basis points to 5.70%.

In the broader market, declining issues led advances 1,130 to 1,098 on heavy trading of 459 million shares on the New York Stock Exchange.

The technology-heavy Nasdaq composite index plunged 15.86 points, or 1.49%, to 1,051.10.

Analysts said the “triple witching” expiration of options, futures and stock index options added to the market’s volatility.

However, the main event was the shakeout of technology stocks following bad earnings news from Oracle and Apple Computer, they said.

“The main interest is in high techs and Nasdaq,” said Alfred Goldman, technical research director at A.G. Edwards.

Apple said its earnings would be sharply below market expectations because of product delays and shortages. The stock fell 4 1/8 to 35 7/8.

Oracle, the Redwood City, Calif.-based maker of software products for database management, reported first-quarter earnings after the close of trading Thursday.

The company also said its server license revenue slowed in growth and its overall revenue growth slowed to 39% from growth in the 50% range in last year’s quarters. Oracle plunged 7 1/4 to 37 5/8.

“Buying momentum [in the tech group] has rolled over and I see no reason to call a bottom yet,” Goldman said.

Apple’s problems follow a similar announcement Wednesday by International Business Machines, which said a delay in the delivery of power supplies for its mainframe computers would shift about $250 million in revenue to the fourth quarter from the third.

According to technical analysts, the drop in the high-tech shares is part of a larger consolidation that has been going on since mid-July when the stream of positive news from the firms started to dry up.

Among Friday’s highlights:

* Home Depot rebounded from recent weakness and added 1 1/8 to 39 5/8. Goldman upgraded the stock.

* VF shed 5 1/2 to 51 1/2 after the clothing maker forecast that its quarterly results would fall by as much as 25% from a year ago.

* Federal Express climbed 6 3/8 to 80 after it announced gains in its shipping activity in August.

* PepsiCo rose 5/8 to 49 7/8, adding to gains after the company management’s upbeat meeting with analysts and portfolio managers early this week.

* Weaker technology issues included Applied Materials, off 4 3/4 to 100 1/2, Integrated Silicon lost 4 to 40 after its 7 1/2 point drop on Thursday. IBM lost one to 92 1/8.

The Standard & Poor’s composite index of 500 stocks fell 0.26 of a point to 583.35. The American Stock Exchange index lost 2.19 to 550.58.

The NYSE Composite index of all listed common stocks rose 0.25 to 313.00, a new high. The average share was down 3 cents.

The dollar rose above 104 yen for the first time in 15 months after senior officials from Japan, Germany and the United States said they wanted a stronger dollar.

In late New York trading, the dollar ended at 104.07 yen, up from 102.50 yen Thursday. It hit 104.15 in late-day trading, its highest level since June 9, 1994.

In overseas trading, London’s FTSE-100 finished 0.8 points lower at 3.564.6.

The Tokyo stock market was closed for a holiday. In Mexico, the Bolsa index fell 17.11 to 2,566.07.