U.S. Stocks Mixed In Tentative Trade As Oil Gains

NEW YORK (MarketWatch) -- U.S. stocks on Monday turned mixed after declining at the start as climbing crude prices pressured the consumer sector, eclipsing cheer from the Senate's passage of housing legislation that includes a rescue plan for Fannie Mae and Freddie Mac.

"As much as Wall Street doesn't like the intervention, it should look at the bullish bigger picture that the administration will do whatever it takes to prevent the economy from rolling over into a recession," said Marc Pado, U.S. strategist at Cantor Fitzgerald.

The Dow Jones Industrial Average declined 33.13 points to 11,337.56, with 21 of its 30 components trading lower.

The S&P 500 rose 1.5 points to 1,259.26 and the Nasdaq Composite gained 2.55 points to 2,313.08.

The Senate on Saturday voted for the measure that President Bush has signaled he would sign, but cheer over the pending legislation was offset by Friday's late seizure of two banks by federal regulators.

Wall Street's tentative tone came as crude resumed its climb upward and ahead of economic reports due later in the week.

In early trade on the New York Mercantile Exchange, crude-oil futures gained $1.34 to stand at $124.6 a barrel.

"Crude is extremely oversold and we would be looking for a technical bounce with initial resistance at $128 and more significant supply at $133," said Pado.

Shares of Kraft Foods Inc. gained 2.3% after the maker of cheese and other food products reported better-than-expected quarterly profit and raised its outlook for the year.

Verizon Communications Inc. said its second-quarter profit climbed 12% but revenue fell short of expectations. Shares of the telecommunications company fell 2.6%.

Amgen Inc. rallied nearly 15% after it said its experimental osteoporosis drug curbed the risk of fracture in post-menopausal females.

By Kate Gibson