NEW YORK — Wall Street recovered from a mostly down session today, eking out a gain as investors brushed off another slide in Chinese stocks.

The market had little in the way of corporate or economic news to give it direction, but while it was in negative territory for much of the day, in the end it shook off an 8.3 percent slide in the benchmark Shanghai Composite Index. The Chinese index had its biggest one-day drop since the Feb. 27 plunge that set off a brief global market selloff as the Chinese government attempts to cool the country's market boom.

Investors used today to adjust positions after both the Standard & Poor's 500 index and Dow Jones industrial average surged to record closes in the previous session. The market was encouraged by economic data released last week that suggested the economy was slowing, but not too quickly, and inflation remained in check.

However, the Commerce Department reported today that orders to U.S. factories were weaker than expected in April.

U.S. FACTORY ORDERS FALL SHORT OF PROJECTION

WASHINGTON — Orders to U.S. factories posted a weaker-than-expected gain in April as declines in demand for cars, planes and boats offset strength in business investment.

The Commerce Department reported today that factory orders increased by 0.3 percent in April, the weakest showing in three months. It was less than half of the 0.8 percent increase that analysts had been expecting.

Still, economists were encouraged that orders for non-defense capital goods excluding aircraft — a category considered a good proxy for business investment — was up a strong 2.1 percent in April following an even larger 4.6 percent rise in March.

The lower-than-expected overall reading reflected a 1.6 percent drop in orders for transportation equipment, an extremely volatile category that had soared by 13.6 percent the previous month.

PALM INC. HOPES DEAL WILL ADD TALENT, STRENGTH

SAN JOSE, Calif. — Faced with mounting competition in the smart-phone market, Palm Inc. is selling a quarter of its company to a private equity firm to arm itself with new leadership, most notably the former technical guru behind the iPod.

The deal with Elevation Partners — which agreed to invest $325 million for a 25 percent stake in Palm — will infuse new talent in the handheld computer pioneer as it battles stiffening competition that will only get tougher with Apple Inc.'s June 29 launch of the iPhone.

As part of the deal, Palm will pay a special distribution of $9 per share, or about $940 million in cash, to shareholders. It said the special distribution would be financed by the new investment, cash on hand and $400 million in new debt.

KRISPY KREME LOSSES INCREASE AMID RECOVERY

WINSTON-SALEM, N.C. — Krispy Kreme Doughnuts Inc. said today its fiscal first-quarter loss widened as the doughnut maker continued its recovery from a bad stumble several years ago.

In the quarter ended April 29, the doughnut maker said its net loss was $7.4 million, or 12 cents per share, compared with a net loss of $6 million, or 10 cents per share, in the year-earlier quarter.

Revenue fell to $110.9 million from $119.4 million a year earlier.

The results include a $9.6 million charge related to a prepayment fee and the write-off of deferred financing costs. The company also received a $14.9 million credit because of the decrease in the fair value of securities it issued in connection with the settlement of litigation.

Wall Street expected earnings of 5 cents per share on $115.7 million of sales, according to analysts surveyed by Thomson Financial.

MARKETS UNFAZED BY LATEST CHINESE FALL

BEIJING — Chinese stocks plunged today following government efforts to cool a market boom, recording their biggest one-day fall since a February drop that triggered a global sell-off.

While Chinese stocks plunged 8.3 percent today, markets in Australia, Indonesia, Singapore, South Korea and the Philippines — rose to record highs. Tokyo's Nikkei 225 index edged up 0.08 percent, while Hong Kong's benchmark index rose 0.6 percent.

Even U.S. and European shares largely shrugged off the decline in Chinese shares, a far different outcome than in February, when an almost 9 percent decline in the benchmark Shanghai Composite Index set off alarm bells across global bourses.

Today, the Shanghai Index tumbled to 3,670.40, falling for the third time in four sessions since the government raised a tax on trading last week to cool a market boom. The index had dropped 2.7 percent Friday. The Shenzhen Composite Index for China's smaller second market fell 7.9 percent to 1,039.90.

It was Shanghai's biggest decline since Feb. 27, when the main-market composite index slid 8.8 percent, triggering selloffs in Hong Kong, New York and London.

HYUNDAI'S HIGH MARKS SHOW INCREASE IN CAR QUALITY

DETROIT — When it comes to car quality, think Korean.

Hyundai Motor Co. leads in five categories in the annual vehicle quality study released today by Strategic Vision Inc., a San Diego-based market research company and consultant to automakers.

Hyundai's rise in the rankings is only the latest sign of the improved overall quality and declining number of defects in today's cars and trucks, said David Cole, chairman of the Center for Automotive Research in Ann Arbor.

He said that means buyers will pay increasing attention to dealer service, new technology, fashion features, price and fuel economy.

Once known best as the maker of cheap, entry-level cars with nagging manufacturing flaws, the South Korean automaker outperformed its Japanese, European and U.S. rivals in this year's survey, based on interviews with 27,780 people who bought 2007 models from September 2006 to November 2006.

OIL PRICES RISE AS PUMP COSTS INCH DOWN

NEW YORK — Oil futures jumped more than $1 a barrel today as a cyclone bore down on the Persian Gulf, even as retail gasoline prices continued their slow retreat from their recent highs.

Concerns about refinery capacity also supported oil prices.

The average national price of a gallon of gasoline at the pump dipped to $3.158 today, down 0.6 cent overnight and off 6.9 cents from its May 24 high, according to AAA and the Oil Price Information Service.

Light, sweet crude for July delivery, however, rose $1.13 to settle at $66.21 a barrel on the New York Mercantile Exchange, while gasoline futures for July fell 0.66 cent to settle at $2.238 a gallon on the Nymex.

In other Nymex trading, heating oil futures rose 4.18 cents to settle at $1.9646 a gallon, and natural gas prices jumped 31.3 cents to settle at $8.191 per 1,000 cubic feet.

ASIAN ELECTRONICS MAKER BUYS COMPETITOR

MILPITAS, Calif. — Singapore's Flextronics International Ltd. will buy rival contract electronics maker Solectron Corp. for about $3.6 billion in cash and stock. Solectron shares climbed more than 14 percent in morning trading.

Under the deal announced today, Solectron will become a subsidiary of Flextronics, with Solectron shareholders holding a stake of between 20 percent to 26 percent.

Solectron will nominate two people to the board of the combined company, subject to approval by Flextronics.

Flextronics Chief Executive Mike McNamara said the deal will give Flextronics increased scale to extend its market reach and save on costs.

PFIZER FACES 2ND NIGERIAN LAWSUIT

ABUJA, Nigeria — The Nigerian government filed a lawsuit today against Pfizer Inc., asking for $7 billion in damages over allegations the pharmaceutical company conducted a drug experiment that led to deaths and disabilities among children more than a decade ago, court papers showed.

The civil case filed in the capital, Abuja, is separate from a legal challenge launched in the northern state of Kano that seeks $2 billion from Pfizer, although all the cases stem from the same mid-1990s drug study.

Pfizer has denied the charges in the Kano case, which are substantively similar to those in the Abuja-based suit.