Stocks Mixed as Oil Prices Rise

Stocks finished mixed Thursday, a surprisingly resilient performance in the face of another gain in oil prices, analysts said.

In the bond market, yields were little changed as some investors took comfort from a report showing that gains in U.S. worker productivity in the fourth quarter were larger than originally estimated.

Many investors were awaiting today’s government report on February employment trends.

Trading in crude oil futures again grabbed the spotlight on Wall Street. Near-term futures rose as high as $55.20 a barrel -- above the record closing high of $55.17 set Oct. 26 -- before falling back to end at $53.57, up 52 cents for the day.

Oil prices have jumped 15% in the last month as the Organization of the Petroleum Exporting Countries and the International Energy Agency raised global oil-use forecasts.

“It’s just the underlying demand” that investors are focusing on, said Bob Frye, a commodity trader at Access Futures & Options in Woodlake, Calif.

Others say speculators are again jumping into the oil market, helping to drive up prices.

On Thursday, at least, the stock market was relatively unfazed by the continuing climb in crude.

The Dow Jones industrial average rallied early, pulled back at midday, then rallied again near the close. The index ended with a gain of 21.06 points, or 0.2%, to 10,833.03.

The broader Standard & Poor’s 500 index edged up 0.39 point to 1,210.47.

Winners topped losers by 17 to 15 on the New York Stock Exchange.

On Nasdaq, losers had the edge, and the Nasdaq composite index gave up 9.10 points, or 0.4%, to 2,058.40.

But a key index of smaller stocks, the S&P; 600, added 0.47 point, or 0.1%, to 332.53, a record closing high.

Share prices have rebounded from their lows in January amid rising optimism about the economy and corporate earnings.

“What oil prices have done is cap what otherwise would be a very good market,” said Gregory Fuss, a money manager at Deutsche Bank Private Wealth Management in Los Angeles.

Market bulls are betting that today’s February employment report will complement other data pointing to continued economic strength.

But a large gain in new jobs could rile the bond market if investors believe the Federal Reserve would accelerate its credit-tightening campaign.

Bond investors were encouraged by Thursday’s government report revising fourth-quarter productivity growth to a 2.1% annualized rate from an initial estimate of 0.8%.

Faster productivity growth could alleviate inflation concerns and allow the Fed to proceed slowly in raising short-term interest rates.

The benchmark 10-year Treasury note yield ended unchanged at 4.38%. It has risen from just below 4% three weeks ago.

Among the day’s highlights:

* Oil stocks again led the market. Unocal soared $6.60 to $60.10 after the Wall Street Journal said ChevronTexaco was mulling over a takeover offer. ChevronTexaco slipped 38 cents to $61.19.

Among other energy companies, Occidental Petroleum jumped $2.07 to $73.01, Kerr McGee gained $2.66 to $81.65 and Sunoco rose $3.50 to $101.80. Sunoco said it raised its annual dividend 33% to $1.60 a share.

* In the retail sector, drugstore chain CVS surged $2.72 to $52.78 after raising its first-quarter profit outlook, citing sales of flu treatments. Rival Longs Drug shot up $3.30 to $30.25.

* Wal-Mart added 91 cents to $52.86 after saying sales at stores open at least a year rose 4.1% in February. The company also raised its annual dividend 15% to 60 cents a share. Other retail stocks were mixed on February sales reports.

* Boeing rose sharply on reports that the Air Force will lift a suspension order that had prevented the company from seeking multibillion-dollar rocket contracts. The shares zoomed $2.12 to $57.42.

* Mortgage finance giant Fannie Mae lost $1.10 to $58.51 on concerns that the company’s planned earnings restatement, because of accounting issues, could be larger than investors already were expecting.