Wall St recovers late to end up on bargain hunting

NEW YORK (Reuters) - U.S. stocks staged a comeback in late trading on Monday as bargain hunters snapped up beaten-down shares, setting aside concerns that efforts to tackle the euro-zone debt crisis could stifle the global economy.

Retailers Wal-Mart Stores Inc and Target Corp also rose ahead of earnings later in the week. The world's largest retailer, Wal-Mart, is expected to post a rise in profit from a year ago, though it is also expected to show it is losing shoppers as the economy improves.

"Things got a little oversold and things were getting a little overdone on the downside recently," said Stephen Massocca, managing director at Wedbush Morgan in San Francisco.

Shares of Wal-Mart rose 1.2 percent to $52.73 and Target gained 1.6 percent to $56.05.

The euro slid to a four-year low at one point before rebounding, helping take indexes down more than 1 percent earlier in the day as investors fretted that the steps some euro-zone nations are taking to cut their budgets will hinder economic growth.

The Dow Jones industrial average <.DJI> edged up 5.67 points, or 0.05 percent, to end at 10,625.83. The Standard & Poor's 500 Index <.SPX> added 1.26 points, or 0.11 percent, to 1,136.94. The Nasdaq Composite Index <.IXIC> rose 7.38 points, or 0.31 percent, to close at 2,354.23.

Adding to apprehension over the still fragile recovery, a gauge of manufacturing in New York state showed growth advanced at a slower pace in May, while a Chinese leading economic indicator showed the country's growth may have already peaked.

Demand worries hit commodities, including oil, which fell more than 2 percent, or $1.53, to settle at $70.08 a barrel. Energy companies were the S&P 500's biggest laggards with Exxon Mobil off 0.5 percent at $63.27. Freeport-McMoRan Copper & Gold lost 2.5 percent to $67.97, as copper prices tumbled 5.6 percent.

Shares of manufacturer Caterpillar , down 1.7 percent at $63.78, weighed on the Dow.

Shares of major U.S. home improvement chain Lowe's Cos fell 3.1 percent to $25.26 after giving a disappointing profit forecast for the year. But the Dow Jones U.S. home construction index <.DJUSHB> reversed course to gain 0.5 percent after data showed that U.S. home-builder sentiment increased in May to the highest level in more than two years.

(Reporting by Leah Schnurr; Additional reporting by Angela Moon; Editing by Jan Paschal)