U.S. Stock Indexes Mixed As Oil Resumes Rise
NEW YORK (MarketWatch) -- U.S. stocks traded mixed Monday as investors hesitated after last week's strong gains while tracking the price of crude oil, which resumed its rise as fighting between Russia and neighboring Georgia sparked supply concerns.
"Concerns are growing that a sustained battle could drive oil prices higher. It may turn out that the retreat in oil/gas prices over the past few weeks may prove to be a short-lived phenomenon," said Kevin Giddis, managing director, Morgan Keegan & Co.
After falling more than 50 points early on, the Dow Jones Industrial Average was off 16.13 points in late-morning trading at 11,718.19, with 15 of its 30 components lower.
American International Group Inc. led the decliners among the blue chips, recently falling 2.8%.
Telecommunication companies were among those gaining on the Dow, with Verizon Communications Inc. and AT&T Inc. both up about 1.5%. The gains came in the wake of a labor agreement between Verizon and two unions representing 65,000 workers. .
The S&P 500 shed early losses to rise a fraction to 1,296.64, with the materials sector hit the hardest among the S&P's 10 industry groups.
The technology-heavy Nasdaq Composite gained 9.30 points to 2,423.40, with Amazon.com and chip manufacturers keeping the tech sector in the green.
Narrow gains in crude futures helped dampen investor sentiment, as fighting between Russia and neighboring Georgia sparked supply concerns over oil shipments. .
Volume on the New York Stock Exchange totaled 235 million shares, and advancing stocks outpaced those declining roughly 8 to 7. On the Nasdaq, nearly 188 million shares changed hands, and advancers outpaced decliners 7 to 5.
U.S. stocks had ended sharply higher Friday as strength in the dollar triggered losses for commodities, notably oil. Transport and housing stocks led the advance, in which the Dow industrials rallied 302 points, the S&P 500 rose 30 points and the Nasdaq Composite added 58 points.
"We believe the markets may have a few more weeks left on this current rally before financial-related issues take center stage again," said Paul Nolte, director of investments at Hinsdale Associates.
"The markets showed how interrelated they all are on Friday," said Marc Pado, a strategist at Cantor Fitzgerald. "I dare to say that what roiled the market on Thursday was equally responsible for rallying the market the next day."
UPS in news
On the M&A front, two prospective deals held the spotlight.
Waste Management Inc. hiked its unsolicited offer for Republic Services to $6.73 billion, or $37 a share.
And a United Parcel Service Inc. executive said a proposed bid for Dutch rival TNT NV would devalue the U.S. package-delivery giant, according to Reuters.
In addition, Bloomberg News reported that GATX Corp. has offered General Electric Co. more than $3 billion for its rail- services unit.
Berkshire Hathaway Inc.
late Friday said its second-quarter net income dropped 8% on sharply lower underwriting earnings, but shares of the company owned by billionaire Warren Buffett traded more than 1% higher in recent action.
The dollar, after climbing to a new five-month high against the euro, reversed ground and fell against the single currency and other major crosses. It's still far higher than on Thursday, when the European Central Bank acknowledged the current weakness of the euro-zone economy.
Overseas, the Nikkei 225 ended 2% higher in Tokyo. And the pan-European Dow Jones Stoxx 600 index gained 1% to 292.10.
By Kate Gibson