Stocks can't shake credit fears

NEW YORK (CNNMoney.com) -- Stocks seesawed before moving mostly lower Monday, as a $2 drop in the price of oil failed to cool residual credit market concerns, which sent stocks tumbling late last week.

The Dow Jones industrial average (up 7.56 to 13,189.47, Charts) was up 0.2 percent about an hour into the session.

The broader S&P 500 (down 0.86 to 1,432.20, Charts) lost 0.2 percent while the tech-laden Nasdaq composite index (down 11.02 to 2,500.23, Charts) retreated 0.4 percent.

Stocks plunged late Friday, with the Dow industrials falling over 280 points on continued credit market fears, sparked by Wall Street bank Bear Stearns.

Just two days after stressing in a conference call Friday it was weathering the worst financial market atmosphere in 22 years, Bear Stearns (down $3.89 to $104.46, Charts, Fortune 500) said its president and chief operating officer Warren Spector resigned Sunday amidst the firm's recent credit problems.

The lack of direction for stocks on Monday suggested that investors appeared to remain nervous about the state of credit markets, despite the lack of any new developments.

Lower oil prices provided support to stocks as U.S. light crude for September delivery lost $1.92 to $73.56 a barrel. Just a week ago, oil prices reached a record trading high of $78.77.

With no major economic readings to be released Monday, Wall Street is focused on the Federal Reserve's Tuesday policy meeting. The central bank is widely expected to leave the Fed funds rate untouched at 5.25 percent, where it has remained since August 2006.

In domestic corporate news, private equity firm Cerberus Capital Management named ex-Home Depot (down $0.10 to $36.09, Charts, Fortune 500) chief Robert Nardelli as Chrysler's chairman and chief executive officer. Nardelli left Home Depot in January under a cloud of shareholder disapproval.

Overseas, Dutch chemical maker Akzo Nobel (up $0.51 to $81.71, Charts) raised its bid for Britain's ICI to $16.3 billion and will get access to its rival's books.

And Belgian-Dutch financial group Fortis won shareholder approval for its $18-billion bid to buy rival ABN Amro (up $0.74 to $48.88, Charts).

European markets mostly fell in midday trade. Asian markets experienced a sharper selloff in the wake of the steep U.S. decline Friday.

The dollar fell against the euro and yen.

Treasury pricesdipped, with the benchmark yield on the 10-year note rising to 4.69 percent from 4.69 late Friday. Bond prices and yields move in opposite directions.

COMEX gold for December fell $1.60 to $682.80 an ounce.