WALL Street stocks staged a dramatic retreat and comeback as the Dow Jones industrials dropped 70 points on mounting fears of inflation and then swung back up late in the day to close slightly higher.

The Dow average was up 1.09 points to close at 5487.07, breaking a four day losing streak that took the blue chip index down more than 200 points.

The index stumbled at the opening following some slightly stronger than expected wholesale inflation data, sank sharply on strong sell programs but crawled back in the afternoon.

Stocks had a muted reaction to a Labour Department report that wholesale prices rose 0.5 per cent in March, the biggest increase in three months.

Investors will get another look at inflation tomorrow with the release of the March consumer prices index.