US STOCKS-Wall St flat, but commodity shares gain

* Investors bullish about earnings, but volume seen weak

* Rise in commodity prices lifts energy shares

* Still no agreement on U.S. budget, midnight deadline

* Indexes: Dow, Nasdaq flat, S&P up 0.6 pct

* For up-to-the-minute market news see [STXNEWS/US]
(Updates indexes)

By Edward Krudy

NEW YORK, April 8 (Reuters) – Investors chased materials
and energy stocks on Friday in an otherwise lackluster start to
Wall Street’s last trading session before earnings season.

Stocks have traded in a tight range at elevated levels this
week, with trading volume low as investors focus on upcoming
earnings as the next catalyst set to drive equity prices.

A fall in the dollar, pressured by expectations of more
rate hikes in the euro zone, as well as hopes for strong
demand, helped lift oil and metal prices.

Chevron Corp (CVX.N: Quote, Profile, Research), up 0.6 percent to $109.65, was the
biggest boost to the Dow industrials. Among miners Freeport
McMoRan Copper & Gold (FCX.N: Quote, Profile, Research) rose 0.9 percent to $58.

“All the action is in commodities,” said Ryan Detrick,
senior technical strategist at Schaeffer’s Investment Research
in Cincinnati. “It seems like a lot of money is chasing that
area currently.”

The Dow Jones industrial average (.DJI: Quote, Profile, Research) dropped 4.12
points, or 0.03 percent, to 12,405.37. The Standard & Poor’s
500 Index (.SPX: Quote, Profile, Research) rose 0.57 point, or 0.04 percent, to 1,334.08.
The Nasdaq Composite Index (.IXIC: Quote, Profile, Research) dropped 2.34 points, or 0.08
percent, to 2,793.80.

The earnings season will begin unofficially with Alcoa Inc
(AA.N: Quote, Profile, Research), the first Dow component to release results after the
market’s close on Monday. JPMorgan Chase & Co (JPM.N: Quote, Profile, Research) and
Google Inc (GOOG.O: Quote, Profile, Research) are due to report later in the week.

Recent volume has been among the lowest of the year as
investors wait to see how corporations are faring in an
environment with overseas headwinds but also signs of
recovery.

“Most people are very bullish and focused on earnings
season, which should see solid growth, especially in
financials, technology and commodities,” said Paul Brigandi,
vice president of trading at Direxion Funds in New York.

Brigandi added that the S&P was nearing resistance around
1,345, near its 2011 high, and that could make larger near-term
gains more difficult.

Brent crude climbed to a 32-month high and was at $124.99
a barrel helped by concern of a shortage of Libyan oil.
Occidental Petroleum Corp (OXY.N: Quote, Profile, Research) rose 1.8 percent to $102.91
and the S&P Energy index (.GSPE: Quote, Profile, Research) rose 0.6 percent.
[ID:nL3E7F80GG]

Copper (CMCU3: Quote, Profile, Research) rose 1.9 percent while gold hit record highs
on Friday and silver reached its strongest level since early
1980.

U.S.-listed shares of miner Rio Tinto Plc (RIO.N: Quote, Profile, Research) rose 2.7
percent. [ID:nL3E7F80GG]

Detrick said the breakout in silver prices could bode well
as a strong indicator of industrial demand. “It’s a big
industrial metal and that’s a potentially good sign for the
global economy,” he said.

The euro rose to a 15-month high against the dollar,
supported by expectations of more euro zone interest rate
hikes, while the prospect of a U.S. government shutdown pushed
the dollar broadly lower.

The White House and Congress faced a midnight deadline to
break a budget deadlock. House of Representatives Speaker John
Boehner said on Friday there was still no agreement. “When will
the White House and when will Senate Democrats get serious
about cutting spending,” the Republican said. [ID:nWEN0790]

Shares of Seagate Technology Plc (STX.O: Quote, Profile, Research) climbed 9.3
percent to $16.05 a day after it reinstated its dividend and
said it expects its third-quarter revenue and margins to come
in at the higher end of its previous guidance. [ID:nL3E7F73QV]

(Editing by Kenneth Barry)

US STOCKS-Wall St flat, but commodity shares gain