Wall Street wavers on economic worries
NEW YORK -- Wall Street fluctuated today, with investors relieved about falling commodities prices but still unsettled about the uncertainty surrounding the economy.
The Commerce Department gave the market modest comfort when it said orders for manufactured products rose by 1.3 percent in July. The figure was higher than the 0.8 percent predicted by economists polled by Thomson Financial/IFR, but the reading was shrugged off by many traders as outdated.
With automakers expected to report sluggish August sales later in the session and Wall Street cautious about making big bets ahead of Friday's highly anticipated employment report, trading was erratic.
A massive pullback in commodities since earlier in the summer has helped alleviate some of the market's inflation worries. Oil dipped below $109 a barrel Wednesday as the dollar strengthened and Hurricane Gustav appeared to leave oil installations in the Gulf of Mexico largely undamaged.
However, a big reason energy prices have retreated is because of the anemic economy in the United States and other developed countries, which is likely to limit fuel demand.
And while oil's drop should help consumers, it has taken a toll on a few companies -- traders appeared a bit rattled about reports Wednesday that the hedge fund Ospraie Management is shuttering its largest fund due to significant losses in commodities. In midmorning trading, the Dow Jones industrial average rose 12.71, or 0.11 percent, to 11,529.63, after trading in negative territory.
Broader stock indicators also turned higher after trading lower. The Standard & Poor's 500 index rose 0.94, or 0.07 percent, to 1,278.52, and the Nasdaq composite index rose 2.80, or 0.12 percent, to 2,352.04.
Tuesday's trading also reflected Wall Street's skittishness -- stocks gave up a huge early advance only to close lower, as investors' enthusiasm about a selloff in oil and other commodities dissipated and gave way to concerns about the economy.
The big headliner of the week for Wall Street is likely to be the Labor Department's reading on August employment. The report is expected to show a drop in payrolls for the eighth straight month and another uptick in the unemployment rate.
Bond prices moved higher Wednesday. The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 3.72 percent from 3.74 percent in late trading on Tuesday.
