Wall Street report: Monday close

RISING oil prices hit blue-chips, although techs advanced as analysts had another crack at tipping a turnaround. The Dow Jones Industrial Average dipped 41.24 points or 0.4% to 10,362.70 after dropping 140 points earlier in the session. The Nasdaq climbed 17.27 points or 1% to 1862.62.

Conflict in the Middle East drove oil prices higher by 51 cents to $26.88 a barrel, near a six-month high. Economists said rising oil prices could pinch off a US recovery by reigniting inflation, prompting higher interest rates and cutting consumers' disposable income.

BP's US shares firmed 54 cents or 1% to $53.64. ExxonMobil was steady at $43.83. Defence issues moved ahead on concerns that the Israeli-Palestinian conflict will spread, leading to increased spending on equipment. General Dynamics was marked up $2.03 or 2.2% to $95.98. Northrop Grumman vaulted $3.07 or 2.7% to $116.12.

Wal-Mart weighed on the Dow. On a day in which it was crowned the world's biggest company by the Fortune 500, shares in the world's biggest retailer retreated $1.74 or 2.8% to $59.56, a five-week low. UBS Warburg and Merrill Lynch were cautious about Wal-Mart on hints that March sales might have disappointed.

Ford slumped another 76 cents or 4.6% to $15.73 on a broker downgrade and reports that it was having oil leakage problems with its popular F-150 truck series.

Sun Microsystems helped lift the tech sector as Merrill Lynch made positive comments on the networking computer company. Sun shares leapt 70 cents or 7.9% to $9.52.

Upgrades in the beaten-down communications equipment sector translated into gains. Cisco Systems jumped 59 cents or 3.5% to $17.52. Ciena gained 37 cents or 4.1% to $9.37. Lucent rose eight cents or 1.7% to $4.81. Nortel Networks added 14 cents or 1.7% to $4.63. Positive spin from internet analyst Mary Meeker of Morgan Stanley helped Yahoo advance 21 cents or 1.1% to $18.68.