Stock rally dies
at end of session
By Michael J. Martinez
Associated Press
NEW YORK >> Wall Street waffled through an erratic session yesterday, closing mixed as investors nervously watched oil prices but also allowed themselves to be encouraged by good economic news.
Stocks moved in the opposite direction from oil prices for much of the day, declining until early afternoon as crude climbed to $44.34 a barrel on the New York Mercantile Exchange. As oil fell below $43 on the way to a $42.83 close, Wall Street managed a late-session rally -- but that advance quickly fizzled.
Still, the market's tone kept analysts and traders optimistic about the market's long-term prospects, though many cautioned that the typical summer doldrums would likely prevent a major rally this month.
"Yes, we have oil prices rising, but I think overall, we're starting to see some settling down in the market," said Bill Groenveld, head trader for vFinance Investments. "All the unknowns that drove the market down in July are starting to pan themselves out. There may be a malaise in the marketplace for a while, but it's better than uncertainty."
Stocks also received a boost from two key economic reports. Factory orders rose 0.7 percent in June, more than Wall Street expected. And the Institute of Supply Management's service sector index for June rose more than economists had forecast.
The Dow Jones industrial average rose 6.27, or 0.1 percent, to 10,126.51.
Broader stock indicators were narrowly lower. The Standard & Poor's 500 index was down 1.06, or 0.1 percent, at 1,098.63, and the Nasdaq composite index dropped 4.36, or 0.2 percent, to 1,855.06.
Bond prices finished nearly unchanged yesterday. The price of the benchmark 10-year Treasury note rose 1/32 point, and its yield, which moves in the opposite direction, fell to 4.42 percent compared with 4.43 percent late Tuesday. The 2-year note was unchanged, yielding 2.65 percent.
Although the rally lost wind at the end of the session, the Dow enjoyed its fourth late-day rally in the last six sessions.
Oil prices remain a concern, since higher fuel costs could trickle down to the consumer as food producers and major retailers will pay a higher cost in shipping.
"Combine (higher oil prices) with a slowdown in consumer spending, that makes it very hard for anyone to get into the market right now," said Neil Massa, an equity trader at John Hancock Funds.
But yesterday's economic figures were an encouraging sign that the economy's spring "soft spot" may not have lasted. Factory orders for June were higher than the 0.4 rise in May. And orders for durable goods rose 0.9 percent in June, up from a 0.9 percent decline in May, the Commerce Department said.