NEW YORK - WALL Street was little changed in early trading on Monday as crude prices rose on concerns that Israel's attack on Gaza might disrupt oil production and shipments from the Middle East.

Oil rose near US$40 (S$54.55) a barrel on Monday after the conflict between Israel and Gaza's Hamas rulers raised tensions in the Middle East.

Light, sweet crude rose US$1.24 to US$38.96 a barrel on the New York Mercantile Exchange.

The advance in oil was welcome for some investors who have worried that plunging prices signaled a long and severe recession.

Oil has fallen more than $100 from its peak of $147.27 a barrel on July 11 as a slowing economy curbed demand. The increase helped oil companies, with Exxon Mobil Corp. shares up more than 1 percent.

However, investors also digested a potential blow to dealmaking on Wall Street. On Sunday, Kuwait's government canceled its US$17.4 billion K-Dow Petrochemicals joint venture with Dow Chemical Co., saying it was 'very risky' because of the global financial crisis and low oil prices. The joint venture was set to begin on Thursday.

Rohm & Haas Co. maintains that its proposed US$15.3 billion takeover by Dow Chemical won't be affected by Dow's substantial loss of income from the venture. But investors punished shares, driving them down more than 20 per cent to US$50.61, compared with their Friday close of US$63.56. Dow Chemical shares lost almost 9 per cent.

The Dow Jones industrial average rose 5.49, or 0.06 per cent, to 8,521.04.

Broader indexes were mixed. The Standard & Poor's 500 index rose 0.22, or 0.03 per cent, to 873.02; the Nasdaq composite index fell 1.35, or 0.09 per cent, to 1,528.89. -- AP