NEW YORK, AUG. 12 -- Stock prices fell modestly in heavy, erratic trading today, but continued strong demand blunted a wave of profit taking.

The Dow Jones average of 30 industrial stocks, up 88.48 points on Monday and Tuesday, fell 11.16 to 2669.32. Broader market measures mostly were lower.

Trading remained heavy, with 235.70 million shares changing hands on the New York Stock Exchange, compared with Tuesday's 278.13 million, which was the exchange's second-busiest day ever.

Declining issues outnumbered advancers by about 9 to 7.

Depressing prices was widespread selling by investors attempting to cash in gains made in the latest phase of the five-year-old bull market.

Prices moved lower in early trading and remained on the minus side for much of the session. Stocks briefly edged higher at midafternoon, retreated in a late selling spree and later closed above their lows of the day.

Analysts had expected profit-taking after prices rocketed higher Monday and Tuesday, but noted that the relatively small declines today indicated there still was plenty of demand for stocks.

"Considering the big markups earlier this week, it's got to be considered a very good showing," said Michael Metz, a vice president of Oppenheimer & Co.

Money continued pouring into the market from investors who are unwilling to miss out on any further advances and who deemed any moderate price drops as buying opportunities, analysts said.

Most long-term interest rates, considered the most sensitive to market speculation, edged lower today in the credit markets.

AT&T led the list of most active NYSE issues, falling 3/4 to 34 5/8 on volume of 3.9 million shares.

Other active blue chips included Navistar, up 3/8 to 8 1/8; IBM, up 1 3/8 to 170 3/8; GE, down 7/8 to 63 1/2; American Express, up 1/8 to 38 7/8; and Exxon, down 1 1/4 to 99.

TRW rose 3 3/8 to 65 1/8. Ford selected TRW as its main supplier of air bags and advance seat belts. Among auto makers, Ford rose 2 to 108 1/2 and and Chrysler rose 2 1/2 to 43 3/8, while GM rose 1/8 to 90.

Digital Equipment rose 2 1/8 to 182 1/8. Among other technology issues, Unisys fell 7/8 to 47 3/8, Data General fell 3/4, National Semiconductor fell 1/8 to 15 and Matsushita rose 6 3/8 to 175 5/8