Wall Street on Monday continued its recent pattern, as major stock indexes rallied early in the day, then gave up most of their gains by the closing bell. Trading was thin.
Still, most stocks closed higher, and the Standard & Poor's 500 index rose for the third consecutive session.
The broad market has stabilized this month after slumping in late April on concerns about interest rates, oil prices and instability in Iraq.
But the pattern of early rallies and afternoon sell-offs in recent days suggests that short-term traders are largely in control of Wall Street, and that many longer-term players are sidelined.
"I think the market is basically wrestling with the fact that it's had a good correction and that a lot of the selling is over with, based on the news we know," said Barry Berman, head trader for Robert W. Baird & Co. in Milwaukee. "But I think it is waiting for some good news to get going on the upside."
The Dow Jones industrial average was up 79 points shortly after the market opened, then drifted lower and closed with a loss of 8.31 points, or 0.1%, at 9,958.43.
The S&P 500 eked out a gain of 1.85 points, or 0.2%, to 1,095.41. The Nasdaq composite rose 10.89 points, or 0.6%, to 1,922.98.
Winners outnumbered losers by more than 2 to 1 on the New York Stock Exchange and by 5 to 3 on Nasdaq.
So far in May, the S&P 500 is down 1.1% after losing 1.7% in April. Nasdaq is up fractionally after sliding 3.7% last month.
The 30-stock Dow, however, is down 2.6% after falling 1.3% in April.
Wall Street may have gotten an early boost Monday from news that Saudi Arabia plans to boost oil production in an attempt to put a lid on prices.
But oil futures prices in New York jumped again on fears that demand may continue to outstrip supply in coming months. Near-term crude futures surged $1.79 to $41.72 a barrel, a record. The price has climbed from $36.86 on March 1.
In the bond market, yields on Treasury securities eased even though higher oil prices fanned inflation worries.
The 10-year T-note dipped to 4.73% from 4.76% on Friday. The yield has come down from a 22-month high of 4.85% on May 13.
Many analysts say stock and bond markets may trade in narrow ranges until Federal Reserve policymakers provide more clues about how soon they might tighten credit. Amid continuing signs of economic strength, some analysts believe the Fed could raise its benchmark short-term interest rate at its next meeting, scheduled for June 29 and 30.
Among Monday's market highlights:
* Energy-related stocks led the broader market higher. Sunoco rose $2.09 to $60.65, Burlington Resources gained $2.35 to $67.74, ChevronTexaco added 56 cents to $90.17 and offshore driller Transocean was up $1.36 to $27.08.
Oil and gas exploration company Wiser Oil jumped $2.51 to $10.53 after agreeing to a takeover bid by Forest Oil worth $10.60 a share in cash. Forest Oil rose 52 cents to $24.54.
* Also in the energy sector, Western Gas Resources rallied $1.99 to $54.75. The natural gas producer and distributor doubled its dividend and said it would split its shares 2 for 1.
* Home builders' shares attracted buyers. KB Home rose $1.81 to $64.11, Ryland Group jumped $2.84 to $77.34 and Pulte Homes was up $2 to $49.75.
* Some Internet-related shares rallied. IPayment soared $4.06 to $44.03, EBay jumped $1.77 to $82.11 and InfoSpace rose $2.54 to $34.84.
* Buyers returned to many heavy-industry issues that could continue to benefit from a stronger economy. Ingersoll-Rand gained $1.97 to $64.09, steel maker Nucor rose $1.23 to $63.58, Black & Decker added $1.22 to $58.30 and United Technologies was up $1.16 at $82.72.
* Boeing rose $1.16 to $44.56, just below its 52-week closing high of $44.60 reached Feb. 17.
The company may receive as many as 100 orders a year for its new 7E7 plane, Credit Suisse First Boston analyst James Higgins told clients in a note. He raised his rating on Boeing to "outperform" from "neutral."
Boeing shares have risen 5.7% this year.
* Major tobacco stocks were sharply lower after a judge denied U.S. cigarette makers' request to block the government from seeking to collect $280 billion in profit allegedly earned illegally.
Altria Group, the parent of Philip Morris, tumbled $4.37, or 8.9%, to $44.95, and weighed on the Dow index. The stock has fallen from $58 in mid-March.
R.J. Reynolds Tobacco Holdings dropped $3.53, or 6.2%, to $53.73.
* Smart & Final jumped $1.15 to $14.74, the highest price since 1998. The Commerce-based operator of membership grocery warehouse stores last week named its president, Etienne Snollaerts, to succeed Ross Roeder as chief executive.