By Peter McKay
U.S. stocks reversed higher as rallying Wal-Mart Stores Inc.
shares led an advance in the consumer-staples sector.
But a retreat in oil below $80 a barrel and worries about Google
Inc. pulling out of China, against a backdrop of nervousness about
possible interest-rate increases, limited gains.
The Dow Jones Industrial Average (DJI) rose 10 points, or 0.1%,
at 10,634.82, led by Wal-Mart (WMT). Its shares rose 3% after
Citigroup upgraded its investment rating on the retail giant's
stock to buy from hold.
The S&P 500 (SPX) added less than a point to 1,150.64.
The Nasdaq Composite Index (RIXF) fared the worst of the major
indexes, off 0.2%, hurt by a 3.1% decline in Google, Inc. which has
recently complained of cyberattacks originating in China, including
monitoring of human-rights activists.
A person familiar with situation told the Wall Street Journal
over the weekend that Google (GOOG) is likely to take action to
resolve the situation within weeks. Separately, Chinese authorities
have told local news Web sites that Google's Chinese site is likely
to close altogether.
Those reports helped to push U.S.-listed shares of Chinese
search engine Baidu Inc. (BIDU) which would presumably benefit from
an exit by Google, up 5%.
Elsewhere, oil futures settled $1.44 lower at $79.80 as traders'
attention focused on currency markets that set the terms on which
commodities change hands globally.
Traders also bet that the Organization of Petroleum Exporting
Countries will keep its production targets steady this week. But
analysts said the cartel's members are also likely to continue
pumping slightly above the official quotas to cash in on prices
that have remained stubbornly high despite tepid global demand.
"The OPEC members will get away with as much as they can as long
as the financial players are boosting prices through speculation,"
said analyst Fadel Gheit, of Oppenheimer & Co. "The wind is at
their sail."
The U.S. Dollar Index (DXY) rose 0.4%--a move that effectively
makes commodities and other items traded in dollar terms less
expensive to buyers using the greenback. The Dow Jones-UBS
Commodity Index was off 0.7%.
The dollar was helped in part by early bets ahead of a Federal
Reserve rate-committee meeting this week that may produce hints as
to when the central bank might tighten the supply of dollars
sloshing through the global economy
Moody's Investors Service said risks are growing to the four
largest triple-A-rated countries: Germany, France, the U.K. and the
U.S. Meanwhile, Chinese Premier Wen Jiabao warned of a double-dip
recession given financial system risks and continued high
unemployment in some countries.
Among stocks in focus, Phillips-Van Heusen (PVH) jumped 10%
after it agreed to acquire privately-held clothing company Tommy
Hilfiger for 2.2 billion ($3.03 billion), largely in cash, marking
the first major acquisition among retailers in years.
Amylin Pharmaceuticals Inc. (AMLN) climbed 16% after the Food
and Drug Administration said it didn't want more clinical data on a
diabetes drug the company is developing with Eli Lilly and Co.
(LLY) and Alkermes. Alkermes shares climbed 15%, while Lilly was up
0.1%.
Boston Scientific Corp. (BSX) plunged 13% on a report it has
suspended selling a form of defibrillator.
Treasury prices edged lower, with the 10-year note down 1/32 to
yield 3.704%. Gold futures rose $3.60, or 0.3%, to end at $1,105.10
per ounce in New York.