Stocks Gain in Seesaw Session

Positive news from biotech giant Genentech gave the stock market a late lift Monday, although a bump in oil prices to a 4 1/2 -month high limited gains.

The dollar, meanwhile, enjoyed its biggest one-day rise against the euro in more than a month, and Treasury yields were down.

The Dow Jones industrial average ended a seesaw day with a gain of 30.15 points, or 0.3%, to 10,804.51. The broader Standard & Poor’s 500 index added 6.75 points, or 0.6%, to 1,206.83, and the technology-heavy Nasdaq composite index rose 9.44 points, or 0.5%, to 2,051.04 -- its first gain after four straight losing sessions.

Winners topped losers by about 4 to 3 on the New York Stock Exchange and by 8 to 7 on Nasdaq. Trading was tepid.

“Part of this rise is on the Genentech news -- there was a huge jump in the whole biotech index,” said Brian Williamson, vice president of equity trading at Boston Co. Asset Management. “But today has been a very slow day. It’s the second Monday in a row where institutions have been sitting on their hands.”

Shares of South San Francisco-based Genentech, the world’s second-largest biotech company, surged $10.92, or nearly 25%, to $55 after the National Cancer Institute said the company’s Avastin helped lung cancer patients live longer when combined with standard chemotherapy. The American Stock Exchange’s biotech index rose nearly 5%.

Among biotech companies whose shares climbed were ImClone Systems, which added $1.45 to $41.32, and Biogen Idec, which rose $1.38 to $39.41.

Large drug makers also ended higher, with Pfizer up 17 cents to $26.53 and Merck up 13 cents to $32.29. Both are Dow components.

However, insurance company American International Group weighed on the Dow, falling 86 cents to $63.85. The Wall Street Journal and CNBC reported Monday that Maurice Greenberg would step down as chief executive of the group, as the insurance company attempted to distance itself from several regulatory inquiries.

Near-term oil futures settled 52 cents higher at $54.95 a barrel on the New York Mercantile Exchange after climbing as high as $55.05. It was the highest close since Oct. 26. Prices are 52% higher than a year ago.

Crude had eased early in the day after top OPEC producer Saudi Arabia proposed to raise the cartel’s output ceiling by half a million barrels a day to stem soaring global energy costs. But prices later reversed course, driven up partly by a rally in natural gas futures on forecasts of colder weather.

The dollar advanced against the euro as some traders said a decline last week to the greenback’s lowest level since the beginning of the year was excessive.

“We might be seeing some dollar buyers back into the market,” said Lara Rhame, a currency strategist at Credit Suisse First Boston in New York.

The euro fell to $1.337, down from $1.346 on Friday. The dollar traded at 104.93 yen, up from 103.88.

The yield on the benchmark 10-year Treasury note slipped to 4.51% from 4.54% on Friday.

Among the day’s other highlights:

* The retail sector saw gains as a Bear Stearns analyst speculated that J.C. Penney could purchase rival Gottschalks Inc. to increase its market share. The report, cited in Barron’s, also said there would be more consolidation among retailers. Gottschalks added $1.20, or 14%, to $10.08, while J.C. Penney climbed 87 cents to $48.88.

* Research in Motion, maker of the BlackBerry e-mail pager, rose $5.68, or 9.4%, to $66.31 after the company held talks to settle a patent dispute that could halt U.S. sales of the devices and services.

In December, a U.S. appeals court upheld a ruling that Research in Motion engaged in patent infringement against NTP, a small patent-licensing company in Arlington, Va.

The appeals court remanded the case for reconsideration of one issue, giving Research in Motion more time to reach a settlement before it faces a court order to halt sales of some BlackBerry pagers that were at the center of the case.

* Heavy equipment maker Caterpillar weighed on the Dow. It fell $2.47 to $96.53 after Legg Mason analyst Barry Bannister lowered his rating on the company to “hold” from “buy,” saying the stock is fairly valued in the short term near $100.

* Qwest Communications International rose 6 cents to $3.91 after news reports late last week said the telecom company would sweeten its offer, currently $8 billion, for MCI, which added 9 cents to $24.18.