Wall Street turned in a mixed performance today as investors watched the price of oil regain ground and decided to cash in some of their gains from the stock market’s big rally last week.

While the stock market’s major indexes showed modest losses, the number of stocks advancing outpaced decliners by about 2 to 1 on the New York Mercantile Exchange, and by about 4 to 3 on the Nasdaq Stock Market.

The tame session unfolded as oil rose on concerns that the threat of new sanctions against Iran over its nuclear program may escalate tensions in the Middle East. Light, sweet crude rose $2.16 to settle at $131.04 a barrel on the New York Mercantile Exchange.

The rise in oil offset initial market enthusiasm after Bank of America Corp. posted results that beat expectations, raising hope the credit crisis might be easing for the nation’s biggest retail banks. The largest American bank by assets reported that higher investment banking and record revenue helped drive earnings during the second quarter.

With Bank of America’s results, four of the nation’s five biggest banks have now reported better-than-expected earnings, and that’s raising hopes that the financial sector is starting to recover from the year-old credit crisis.

Still, “with crude trading up near $130, and a big advance last week, some investors are taking chips off the table,” the manager of equity trading at Baird & Co, Jim Herrick, said. “We’re going to be in a tight trading range this week based on earnings and oil prices. I expect more of the same.”

The market was also uneasy about earnings at drug makers Merck & Co. and Schering-Plough Corp. Both pharmaceutical companies fell after a new study showed their cholesterol drug Vytorin did not meet its main goals. They also took the unusual step of delaying their second-quarter results until after the closing bell to allow researchers time to present the report.

According to preliminary calculations, the Dow Jones industrial average fell 29.23, or 0.25%, to 11,467.34 after moving in and out of positive territory.

Broader indexes showed more modest declines. The Standard & Poor’s 500 index slipped 0.68, or 0.05%, to 1,260.00; and the Nasdaq composite index dropped 3.25, or 0.14%, to 2,279.53.

The moves follow a strong week for the markets. The Dow last week rose 3.57%, while the Nasdaq increased 1.95%, and the S&P rose 1.71%.

Bond prices rose today as the major stock indexes declined. The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 4.05% from 4.09% late Friday.

The dollar was mixed against other major currencies, while gold prices rose.

A senior technical strategist at Schaeffer’s Investment Research, Ryan Detrick, said the market is still feeling somewhat upbeat about how earnings are shaping up so far this quarter. And that’s helped to maintain some of last week’s market gains, despite the pullback on today.

“We’re having some more good news from the financials — it wasn’t as bad as feared,” he said. “And we’ve also got some buyout deals.”

Some 158 members of the Standard & Poor’s 500 index and 10 members of the Dow industrials are slated to post results this week. The biggest today was Bank of America, which reported that increased bad debt due to the housing slump pushed profits down 41%. However, it still surpassed expectations due to a solid performance in its business not tied to real estate. The stock rose $1.07, or 3.9%, to $28.56.

Investors also were somewhat optimistic that mergers and acquisitions, which have been sluggish since the credit crisis began last year, might be reviving. Swiss drug maker Roche Holding announced plans to acquire the stake in Genentech Inc. it doesn’t already own for $43.7 billion, making it the seventh-largest pharmaceuticals company in America.

Shares of Genentech were among the best performers during the session, rising $12.06, or 14.7%, to $93.88.

Yahoo Inc. fell 78 cents, or 3.5%, to $21.67 after the Internet portal staved off an attempt by an activist shareholder, Carl Icahn, to take control and sell it. Mr. Icahn, who has argued in favor of selling Yahoo to Microsoft Corp., will become a Yahoo director along with two of his nominees.

Toy maker Hasbro Inc. said second-quarter profits rose, helped by the weaker dollar and demand for toys inspired by “Star Wars” and “Indiana Jones.” Sales jumped 13% to $784.3 million. However, concerns about costs and a campaign to raise prices pushed shares down 64 cents to $37.35.

In economic news, the Treasury Secretary, Henry Paulson, sought to reassure the public yesterday that the banking system is sound, while also preparing people for more troubled times ahead. “I think it’s going to be months that we’re working our way through this period — clearly months,” he said.

And that was confirmed by more economic data today. The Conference Board said the economy contracted in June as factories cut workers’ hours and stocks tumbled. The research group’s index of leading economic indicators, a gauge of future economic activity, fell 0.1%, in line with estimates by Wall Street economists surveyed by Thomson Financial/IFR. It also revised its May figure to show a decline instead of slight growth.

The Russell 2000 index of smaller companies rose 4.55, or 0.66%, to 697.63.

Volume on the New York Stock Exchange volume came to 1.2 billion shares.

Overseas, markets in Japan were closed for a holiday. Britain’s FTSE 100 rose 0.52%, Germany’s DAX index added 0.66%, and France’s CAC-40 rose 0.65%.