Stocks Mixed as Gold, Oil Futures Show Some Spark

The stock market remained stuck in a trading range Wednesday, with blue chips advancing modestly while major tech issues pulled back.

There was hotter action in commodities markets: In gold futures trading, rumors about gold buybacks by Australian mining firms helped lift the metal’s price by more than 2%.

In oil markets, crude prices topped $33 a barrel for the first time since March before falling back, though near-term futures still ended up 29 cents at $32.85 a barrel. Gasoline futures also rose further.

On Wall Street a tame consumer inflation report for May helped send long-term Treasury bond yields lower, setting a good tone for stocks.

The 10-year T-note yield slipped to 6.05% from 6.11% on Tuesday. The yield is nearing the 6% threshold--a level it hasn’t been below since mid-April.

“We are very encouraged by the [economic] slowdown” suggested by data in recent weeks, said Charles Van Vleet, portfolio manager at Credit Suisse Asset Management. That could mean the Federal Reserve won’t raise interest rates when it meets June 27-28.

But the stock market apparently couldn’t get very excited by the inflation news. The Dow added 66.11 points, or 0.6%, to 10,687.95 for the session, as winners topped losers by 17 to 13 on the New York Stock Exchange.

On Nasdaq, however, the composite index lost 53.65 points, or 1.4%, to 3,797.41, giving back much of Tuesday’s 83-point gain.

Losers topped winners by 22 to 18 on Nasdaq.

Despite big gains, and big losses, in some key tech stocks in recent days, the Nasdaq index has traded mostly between 3,750 and 3,850 for the last eight sessions.

Traders looking for action may be turning to commodities. Near-term gold futures rose $6.10 to $291.60 an ounce in New York, a 3 1/2-month high, on speculation that mining firms in Australia are buying back metal they sold earlier, betting on further price gains.

Mining companies sell future production to protect against falling prices. Some Canadian producers stopped the practice last year, buying back some metal, in an attempt to halt a plunge in prices that sent gold to a 20-year low in July. Now traders say Australian companies are following suit.

Meanwhile, oil continued to gain as traders bet major oil producers won’t boost output enough to meet demand. But late in the day there were reports that the Saudi Arabian and Mexican oil ministers were holding talks about the price situation.

In gasoline futures trading prices rose to the highest level since the Persian Gulf War--reaching $1.08 a gallon--after a report showed supplies of cleaner-burning fuels, mandated for about one-third of the U.S. market, are 13% below levels a year ago.

Among Wednesday’s highlights:

* Microsoft rose $2.63 to $70.50 after the company Tuesday appealed a federal judge’s decision to split the company in two.

But wireless giant Qualcomm slumped $10.88 to $70.50 on an earnings-estimate cut by a Bear Stearns analyst.

Other tech giants were mixed. Intel slid $5.06 to $126.44 and Applied Materials fell $6.06 to $86.01, while Dell gained $1.13 to $46.19.

* Seagram’s surge of $7.13 to $60.13 on buyout talks helped lift other entertainment issues, including Disney, up 56 cents to $40.75; News Corp., up $1.38 to $51.38; and Viacom class A, up $1.13 to $66.63.

* Strength in some industrial names helped the Dow. Alcoa gained $1.75 to $29.94, 3M jumped $2.31 to $84.19 and United Technologies gained $2.56 to $59.75.

Drug and food stocks also attracted buyers. But energy stocks were mixed despite the continuing surge in crude prices.

Market Roundup, C13-C14