Stocks wobble as debt worries shift to Italy

NEW YORK (AP) ? U.S. stock indexes wobbled between small gains and losses in afternoon trading Monday as investors worried that Europe’s debt crisis would spread to Italy.

Italy’s borrowing rates spiked Monday to the highest level since the country adopted the euro. Unlike Greece, Portugal or Ireland ? all of which received financial lifelines ? Italy has too much debt to be rescued by its European neighbors. Prime Minister Silvio Berlusconi has rejected suggestions that he resign to make way for more cost-cutting.

Concerns about Italy outweighed a deal Greece’s two main political parties reached over the weekend to share power in a new government. The move increases the likelihood that the country will move ahead with austerity measures it promised to implement as part of a financial rescue agreement with lenders. That relieved investors by reducing the chances of an imminent default by Greece, which would rattle financial markets and cause losses for major European banks.

Europe’s debt crisis continued to take investor’s attention away from relatively good news about the economy and U.S. companies. “Every day it seems like it’s the butting of heads between whatever the latest rumor is out of Europe with good economic data and corporate earnings,” said Karyn Cavanaugh, a market strategist with ING Investment Management. “It’s overshadowing the fact that earnings are on track to be the best year ever.”

The Dow Jones industrial average was up 8 points, or 0.1 percent, to 11,992 at 2:15 p.m. Eastern. It had been up as many as 68 points in the first half-hour of trading, and down as many as 102 points.

The S&P 500 was unchanged at 1,253. The Nasdaq lost 7, or 0.3 percent, to 2,679.

The continuing worries over Europe’s debt problems lifted the prices of assets that have traditionally functioned as safe havens. The yield on the 10-year Treasury note fell to 1.98 percent from 2.04 percent late Friday. Bond yields fall when their prices rise, reflecting an increase in demand. Gold rose 2 percent.

Monday is a relatively quiet day for economic and corporate news in the U.S. The Federal Reserve will issue a report at 3 p.m. on how much consumers borrowed in September. Economists expect consumers took out an additional $5.4 billion in loans, a sign that households could be more confident in the direction of the economy.

Amgen Inc. rose 5.2 percent to $58.03, the most in the S&P 500 index, after the biotech drugmaker said it would buy back up to $5 billion of its stock. Dish Network Corp. Dish Network Corp. gained 3.8 percent to $24.38 after the satellite TV provider announced a $2 per share dividend and a 30 percent increase in net income. Home Depot Inc. rose 1.6 percent, the most among the 30 stocks in the Dow, after getting upgraded by analysts.