Stocks end mixed
ahead of meeting

NEW YORK >> Wall Street trudged through a listless session yesterday, closing narrowly mixed as oil prices edged closer to $45 per barrel and investors hoped for assurance from the Federal Reserve that the economy was still on track.

Trading was very light in advance of today's Fed meeting, at which the Open Market Committee will decide whether to raise baseline interest rates by a quarter percentage point to 1.5 percent. While the move had been widely expected before last week, a recent string of bad news has left Wall Street wondering whether the Fed will -- or should -- raise rates.

"Tomorrow is going to be key. We're going to look very carefully at what the Fed has to say," said Russ Koesterich, U.S. equity strategist at State Street Corp. in Boston. "Until then, there's no real conviction in trading. You're seeing some bargain hunting, but we're not seeing the signs of a true bottom here."

Even the bargain hunters couldn't withstand the overall pessimism of the market, as a wave of late-session selling erased the market's modest gains from early in the session. Investors were particularly concerned with oil prices, which climbed once again as Russian oil giant Yukos encountered fresh problems. A barrel of light crude was quoted at $44.84, up 89 cents, on the New York Mercantile Exchange. Prices hit a new record high at $44.98 earlier in the session.

The Dow Jones industrial average fell 0.67, or 0.01 percent, to 9,814.66. Broader stock indicators were narrowly mixed. The Standard & Poor's 500 index was up 1.25, or 0.1 percent, at 1,065.22, and the Nasdaq composite index lost 2.25, or 0.1 percent, to 1,774.64.

Bond prices edged lower, giving up some of their gains from Friday. With short-term interest rates expected to rise following the meeting, investors were hedging their bets yesterday in the Treasury market and sending yields somewhat higher. Bond prices had risen on Friday following a lackluster report on job creation.

The price of the benchmark 10-year Treasury note fell 38 point and its yield, which moves in the opposite direction, rose to 4.26 percent compared with 4.22 percent late Friday. The 2-year note fell 332 point to yield 2.44 percent.

The markets sold off heavily last week as oil prices climbed to new highs and the government reported a paltry 32,000 jobs created in July. The combination left investors concerned that inflation might take hold in an economy that threatens to slow down considerably.

The latest economic news didn't help with forecasts, either. The government reported yesterday that wholesale inventories rose 1.1 percent in June. Wall Street had been expecting a 0.6 percent rise for the month. While the inventory figure shows strong industrial productivity, it also raises questions on whether supply may soon outpace a reduced consumer demand.