Stocks Limp Out of Second Quarter

Updated from 4:14 p.m. EDT

Blue chips closed the final session of the second quarter just barely to the upside, while tech shares continued the weakness that ended last week.

The Dow Jones Industrial Average edged ahead by 3.5 points at 11,350.01, and the S&P 500 added 1.62 points, or 0.1%, to 1280. The Nasdaq lost 22.65 points, or 1%, to 2292.98.

For the Dow, it wrapped up the quarter in negative territory, its third consecutive quarterly decline. That hasn't happened in 30 years.

Oil was in focus again at the start of the new, holiday-shortened week. Crude for August delivery closed down 21 cents at $140, after earlier passing the $143 mark to reach a new all-time high. Investors remain nervous about potential disruption of the Iranian oil supply as tensions mount over its nuclear program. Gasoline prices rose to $4.086 a gallon from $4.079. Gold ended the day down $3 at $928.30.

The early advance in crude had energy stocks trading higher, though the strength in the group was mitigated somewhat as oil pulled back. Devon (DVN Quote) added 4.6% to $120.16, and Peabody (BTU Quote) climbed 4.8% to $88.05.

Elsewhere in commodities, the Department of Agriculture said that this year's corn crop will be 6.3 million acres leaner than last year's thanks in part to flooding in the Midwest. Corn futures reached $7.57 a bushel.

Utilities also logged a slight rally. The Utilities Select SPDR (XLU Quote), which tracks the sector, was up 2.4% at $40.70.

Hand-wringing over the financial sector continued as Wall Street trading got underway. Ladenburg Thalmann analyst Dick Bove said Merrill Lynch (MER Quote) will be forced to raise capital for the third quarter and may have to sell a portion of its stake in Bloomberg. Bove slashed his 2008 earnings estimate for the brokerage to a loss of $1.64 a share vs. his previous forecast of $1.37. He also cut his profit estimates for Morgan Stanley (MS Quote). Merrill slumped 3% to $31.71, and Morgan Stanley lost 1.7% to $36.07.