NEW YORK (AP) — Stocks finished a wobbly session flat yesterday as stubbornly high bond yields discouraged investors from extending Wall Street's recovery from last week's steep losses.The yield on the Treasury's 10-year note rose to 5.15 percent yesterday from 5.11 percent late on Friday. Last week, investors took signs of recalcitrant inflation to mean a rate cut by the Federal Reserve was unlikely, and they sent stock and bond prices tumbling; since yields move in the opposite direction from bond prices, market interest rates soared. The 10-year Treasury yield climbed above 5 percent for the first time since last summer.

The Fed has kept the federal funds rate, the interest banks charge each other for overnight loans, unchanged at 5.25 percent since last summer, following a string of increases over about two years.

"I don't think that there is a lot of clarity as to monetary policy for the rest of 2007 and I think that in general puts markets on edge," said Les Satlow, portfolio manager at Cabot Money Management. "I think it's a reflection of institutional ambivalence," he said of the back-and-forth direction of stocks.

According to preliminary calculations, the Dow Jones industrial average rose 0.57, or less than 0.01 percent, to end at 13,424.96, capping a day of trading that saw stocks slip, advance, and then pull back again. The Dow rose 157 points Friday, but still finished the week down 1.78 percent.

Broader stock indicators were narrowly mixed. The Standard & Poor's 500 index rose 1.45, or 0.10 percent, to 1,509.12, and the Nasdaq composite index fell 1.39, or 0.05 percent, to 2,572.15.

Oil prices, which also stirred inflation concerns last week, rebounded Monday after falling sharply Friday. Iran's oil minister said Monday the Organisation of Petroleum Exporting Countries doesn't plan to release more oil into the market ahead of its next policy meeting in September. Light, sweet crude rose $1.21 to $65.97 per barrel on the New York Mercantile Exchange.

Amid an absence of economic and earnings reports, investors will likely focus on moves of the bond market and individual stocks as they await data on inflation due later in the week. On Thursday, the Labor Department releases its producer price index and on Friday the consumer price index is due.

"The weakness in the bond market is a real concern for equity investors. We have been discussing for several weeks the possibility of a near-term equity market correction being triggered by technical factors. Higher bond yields now also provide a fundamental reason for investors to be wary over the short-term," wrote Bob Doll, BlackRock's global chief investment officer of equities, in a research note.

The Fed's message on inflation has been that it remains too high and that holding down rising prices remains its focus.

Cleveland Fed President Sandra Pianalto, speaking in Germany Monday, said U.S. inflation remains higher than the Fed would like and that spikes in prices, liquidity crises or fiscal imbalances could upend central banks' notions of how contained inflation might be.

In corporate news, Steel maker Nucor Corp. warned its second-quarter profit will fall because customers had increased orders in the first quarter ahead of an expected increase in prices, making for lower orders in the second quarter. Nucor fell $3.95, or 5.9 percent, to $62.66. Other steel makers fell as German steel company ThyssenKrupp AG denied it is in talks to acquire rival US Steel, which fell $8.85, or seven percent, to $116.20.

Homebuilder stocks fell at the prospect that rising interest rates would drive up the cost of buying a home. Hovnanian Enterprises fell 56 cents, or 2.6 percent, to $21.24 and set a fresh 52-week low of $20.95; previously the low was $21.02. Toll Brothers fell 52 cents to $27.62.

The flow of deal-making that has helped prop up stocks in the absence of compelling economic or earnings data continued, but at a slower pace Monday than in recent months. Rexam PLC fell 79 cents to $49.40 after the British company agreed to acquire the plastic packaging business of Owens-Illinois for nearly $1.83 billion. O-I slipped 62 cents to $32.65.

Biotech drug maker Medivation soared $3.62, or 22 percent, to $19.80 after the company said its Alzheimer's drug Dimebon showed favourable results.