NEW YORK, Aug 9 (AFP) - Battered US share prices edged nervously higher Monday as traders sought out bargains on the eve of a widely expected increase in US interest rates.
Late morning, the Dow Jones industrials average of 30 top stocks was up 29.57 points, or 0.30 percent, at 9,844.90.
The broader Standard and Poor`s 500 index climbed 4.28 points, or 0.40 percent, to 1,068.25.
The technology-heavy Nasdaq index gained 6.55 points, or 0.37 percent, to 1,783.44.
"You saw what happened last week, we were pounded on Thursday, pounded on Friday, pretty soon the rubber band stretches to a point where it begins to snap back," said Larry Wachtel, Wachovia market analyst.
"That is what you saw this morning."
Among major stocks, Wal-Mart rose nine cents, or 0.18 percent, to 51.42 dollars, Alcoa climbed 14 cents, or 0.47 percent, to 30.09 dollars, and General Electric climbed nine cents, or 0.29 percent, to 31.61 dollars.
Share prices Friday plummeted to new closing lows for 2004 after a government report revealed employers hired a meagre 32,000 extra workers in July, crushing hopes for a 240,000-strong gain.
"While the employment forecast continues to decimate Street economists, and oil/political events are reasonable concerns, we are unconvinced that the US economy is suffering as badly as the July employment data imply on the surface," said Citigroup Smith Barney senior economist Steven Wieting.
But the rebound was subdued ahead of meeting Tuesday of the policymaking Federal Open Market Committee (FOMC).
The policymakers are broadly expected to raise the federal funds rate, which banks charge each other overnight, to 1.50 percent from 1.25 percent despite the weak July jobs report.
But investors now believed the Fed could decide to suspend an expected interest increase in September, Wachtel said.
Oil prices, too, bubbled close to record highs amid uncertainty about the financial outlook for Russian oil titan Yukos.
"The only thing that can change psychology here is if we get a sharp decrease in the price of oil," said S.W. Bach chief market analyst Peter Cardillo.
Brent North Sea crude oil for September delivery climbed 51 cents to 41.14 dollars in afternoon trading in London, close to the record high level of 41.50 dollars reached last Friday.
New York`s light, sweet crude for delivery September, which hit a record high point of 44.77 dollars per barrel on Friday, rose 44 cents to 44.39 in morning trade.
Prices had eased earlier in the day on hopes of an increase in official Organization of Petroleum Exporting Countries (OPEC) production quotas and a mooted rescue for Russian energy giant Yukos.