Stocks and Bonds: Wall Street Ends the Day Mixed

As markets wavered Wednesday, oil prices fell to their lowest point in six weeks on signs that fuel stockpiles are growing and demand continues to dwindle.

The price of crude oil fell $2.79, to $60.14 a barrel, giving back two months of gains that came as traders speculated that a global rebound was just around the corner. Oil topped $70 a barrel in June for the first time since autumn as China increased its stockpiles and hints emerged that the recession was losing force.

Analysts said, however, that the spike in prices did not match basic economic realities. Crude prices have tumbled 13 percent in the last week.

“The fundamentals of the oil market have been very weak for a long time,” said Antoine Halff, head of commodities research at Newedge. “There’s a realignment of fundamentals and prices. Demand is really weak across the board.”

On Wednesday, the Energy Department reported that gasoline supplies rose by a greater-than-expected 1.9 million barrels, and that supplies of fuels like diesel and heating oil rose by 3.74 million barrels. Separately, the OPEC cartel said that oil consumption would fall in years ahead.

While the drop in oil prices reflects a more subdued outlook, it may offer drivers some relief. Gasoline prices have fallen by about 4 cents a gallon since last week, to a nationwide average of $2.59, according to AAA’s Fuel Gauge Report.

Analysts say that increases in gasoline prices constrain consumer spending on things like electronics, travel and other nonessential items.

Shares of energy producers like Exxon Mobil, ConocoPhillips and Hess fell Wednesday. Exxon declined 30 cents, to $66.26; Conoco lost 55 cents, to $39.44; Hess lost 74 cents, to $48.

The Dow Jones industrial average gained 14.81 points, or 0.18 percent, to 8,178.41. The Nasdaq composite index rose 1 point, or 0.06 percent, to 1,747.17.

The Standard & Poor’s 500-stock index slipped 1.47 points, or 0.17 percent, to 879.56.

On Tuesday, jitters about a rocky corporate earnings season dragged the major indexes to their lowest closing since early May, and analysts said many investors are expecting markets to wobble as companies report their second-quarter earnings.

“People are using this as an opportunity to book some of their profits,” said David Dietze, chief investment strategist at Point View Financial Services cashadvance. “The real 800-pound gorilla gripping the market is, where are the second-quarter earnings going to come out? People are very nervous.”

The aluminum maker Alcoa started earnings season after the end of trading, posting a smaller-than-expected loss of 26 cents a share from continuing operations excluding a restructuring charge. Alcoa cut capital expenses and reduced its work force to reduce its loss.

Shares of Alcoa rose more than 4 percent in after-hours trading and gained 5 cents, to $9.46, before its results were announced.

After months of swift gains and newfound optimism, some analysts say that investors are cashing out profits and taking a hard look at the prospects for an economic recovery as unemployment rises.

The International Monetary Fund estimated that the world economy would rebound in 2010 at a rate of 2.5 percent. But the monetary fund said global growth would shrink 1.4 percent this year, slightly worse than an earlier projection of a 1.3 percent contraction.

The Treasury’s benchmark 10-year note rose 1 6/32, to 98 15/32. The yield fell to 3.31 percent, from 3.45 percent Tuesday, reflecting a renewed appetite for safe investments. An auction of $19 billion 10-year notes drew strong demand, further blunting concerns that investors were reluctant to buy government debt.

“The ability of the federal government to borrow money on favorable terms continues, a net positive for their efforts to fund the various stimulus programs aimed at aiding economic recovery,” Dan Greenhaus, an analyst in the equity strategy group at Miller Tabak, wrote in a research note. “This remains the net takeaway from recent auctions which have been, on average, positive.”

Following are the results of Wednesday’s auction of the 10-year note:

(000 omitted in dollar figures)

Price: 97.998 High Yield: 3.365 Low Yield: 3.282 Median Yield: 3.340 Total applied for: $62,716,687 Accepted: $19,321,538 Noncompetitive: $42,780 Interest set at: 3⁄%

The 10-year notes mature on May 15, 2019.

Stocks and Bonds: Wall Street Ends the Day Mixed

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