(Adds closing data in fifth paragraph)
* U.S. stocks rise; Dell's results auger business spending
* Oil prices bounce back slightly above $127 a barrel
* Bonds gain on tame U.S. inflation, but dollar slips
By Herbert Lash
NEW YORK, May 30 (Reuters) - U.S. stocks rose on Friday
after upbeat earnings at computer maker Dell suggested business
spending is holding up while the dollar fell against the euro
as some investors sold the U.S. currency after recent gains.
Oil prices edged above $127 a barrel as the dollar's drop
drew in investors seeking to hedge against a weaker greenback,
and gold closed 1 percent higher, boosted by oil's gains.
Mild U.S. inflation data calmed fears that consumer prices
may be spiraling ever higher, bolstering European and U.S.
stocks and helping lift recently depressed government debt.
U.S. technology shares rose as Dell Inc's <DELL.O> upbeat
results boosted investor optimism about the outlook for big-cap
tech companies. Dell shares jumped more than 6 percent, making
the stock among the Nasdaq's top boosters, along with chip
designer Marvell Technology Group Ltd <MRVL.O>, which rose more
than 24 percent on stronger-than-expected earnings.
The Dow Jones industrial average <> fell 7.90 points,
or 0.06 percent, at 12,638.32, but the Standard & Poor's 500
Index <.SPX> rose 2.10 points, or 0.15 percent, at 1,400.36 and
the Nasdaq Composite Index <> rose 14.34 points, or 0.57
percent, at 2,522.66.
The three U.S. indexes advanced more than 1 percent for the
week and the Nasdaq gained 4.6 percent in during the month. But
the Dow fell 1.4 percent and the S&P slid 1.1 percent in May.
The semiconductor index <.SOXX> rose 2.3 percent and was
on track for its second straight monthly advance, which will
cap its longest monthly winning streak since October 2006.
"The strength of Dell's numbers was a pleasant surprise,"
said Georges Yared, founder and chief investment officer at
Yared Investment Research in Wayzata, Minnesota.
Dell shares rose to $23.28 on Nasdaq, while Marvell shares
rose to $17.51. Contributing the most to Nasdaq's rise were
shares of iPod-maker Apple Inc <AAPL.O>, up 1.2 percent at
$188.89.
But data showed consumer confidence fell to a 28-year low
in May, and volatile crude prices weighed on enthusiasm,
keeping the blue-chip Dow close to break-even.
A slight bounce back in oil prices helped alleviate growing
inflation fears because costly oil is seen curbing economic
growth. The impact of high oil prices showed up in the euro
zone as inflation surged and Jean-Claude Trichet, president of
the European Central Bank, said policy-makers were worried.
"Our view is that this bull run is not over," said Mike
Wittner of SG. "It's going to continue to be volatile ...
there's further upside."
U.S. crude <CLc1> settled up 73 cents at $127.35 a barrel
after trading as high as $128.30. London Brent <LCOc1> gained
89 cents to settle at $127.78 a barrel.
Trichet said in a published interview that the ECB was
worried the sharp rise in global oil and commodity prices could
lead to spiraling wages and consumer prices.
Unexpectedly weak German retail sales helped moderate the
inflation concerns and short-term euro zone government bond
yields eased after rising inflation put yields on track for
their steepest monthly gain in years.
The dollar fell against the euro as some investors sold the
U.S. currency after a string of recent gains had pushed it to
its first back-to-back monthly gains since January 2007.
The dollar fell against major currencies, with the U.S.
Dollar Index <.DXY> down 0.15 percent at 72.863. Against the
yen, the dollar <JPY=> fell 0.10 percent at 105.39.
The euro <EUR=> rose 0.27 percent at $1.5557.
Gold futures ended 1 percent higher, boosted by oil's gains
and short-covering following the previous day's sharp fall.
The August gold contract <GCQ8> in New York settled up
$9.80 at $891.50 an ounce.
U.S. Treasury debt prices were higher. The benchmark
10-year U.S. Treasury note <US10YT=RR> rose 6/32 to yield 4.06
percent, while the 30-year U.S. Treasury bond <US30YT=RR>
gained 20/32 to yield 4.71 percent.
Bond data:
A rise in banking shares bolstered European equities, with
UniCredit <CRDI.MI>, BNP Paribas <BNPP.PA> and ING <ING.AS>
among the top positive weights on the broader market, rising
between 1.3 percent and 4 percent.
Oil majors BP <BP.L>, Royal Dutch Shell <RDSa.AS> and Total
<TOTF.PA> fell 0.6 to 1.7 percent, reflecting the drop in crude
oil from last week's record highs above $135.
The FTSEurofirst 300 index <> of top European shares
rose 0.3 percent to close at 1,334.39 points, bringing losses
for May to about 0.3 percent.
While the U.S. reading was tame, inflation in the euro zone
surged to a record 3.6 percent in May and fresh data pointed to
an economic slowdown, cementing expectations the ECB will keep
inflation rates on hold this year.
Asian stocks rose, led by exporters in Japan, as fears of a
deep U.S. recession receded but gains were capped by worries
that inflation will cut into growth and boost borrowing costs.
MSCI's pan-Asian equities index <.MIAS00000PUS> edged up
0.1 percent, led by Japan. However, the index was down 1
percent in May after a steep rebound in April, and has lost
more than 5 percent so far this year.
Asian stocks excluding Japan <.MIAPJ0000PUS> gained only
0.1 percent on the day and were down 2.2 percent in May,
according to MSCI.
(Reporting by Ellis Mnyandu, Vivianne Rodrigues, Matthew
Robinson, Chris Reese and Frank Tang in New York)
(Reporting by Herbert Lash. Editing by Richard Satran)
