Bargain Hunters Lift Dow 5.94

Wall Street’s blue chips ended slightly higher today, aided by bargain hunters who swept into the market when stocks were showing steep losses on soaring oil prices and growing Mideast war jitters.

The Dow Jones industrial average closed up 5.94 points at 2,533.17. In the broader market, the number of losing issues barely edged past gainers in thin post-holiday trading volume of 131.54 million shares on the New York Stock Exchange.

The blue chip index was down more than 30 points in midday trading before bargain hunters entered the market and brought the Dow to a higher close.

On the New York Mercantile Exchange, oil prices soared on the possibility the U.N. Security Council on Thursday will set a Jan. 1 deadline for Iraq to withdraw from Kuwait or face war.

“The saber rattling in the Middle East continues to drag us down,” said Thomas Walsh, head of trading at Nikko Securities.

After posting the bulk of the day’s drop amid soaring oil prices, stocks steadied by midday and began to retrace lost ground.

“The bleeding has stopped for the time being,” said Thomas Walsh head of the equities trading desk at Nikko Securities. “But the see-saw of uncertainty continues.”

“The possibility of a U.N. resolution and an ultimatum being passed has gotten war drums beating again,” said Tom Bentz, analyst with United Energy Inc.

Continued jittery stock trading is expected and volume is likely to remain light as investors step to the sidelines to await the outcome of the U.N. meeting, traders said.

Among individual issues, MCA shares were off 3/8 at 65 following the announcement of a definitive merger agreement with Matsushita. The deal was the biggest takeover ever by a Japanese company in the United States, but Wall Street was disappointed by what it perceived to be a low price.

Losers among the blue chips included Boeing, down 1 at 43 5/8; General Electric, down 1/2 at 53 1/8; Westinghouse Electric, down 3/4 at 26 1/4, and General Motors, down 1/8 at 37 1/4.