NEW YORK — A surge in Treasury yields rattled Wall Street today, forcing stocks to give up early gains and drive down the Dow Jones industrial average more than 140 points.

The 10-year Treasury note's yield soared to 5.15 percent today from 5.09 percent yesterday, reigniting worries among stock investors that high rates could thwart corporate deal-making and further injure the limping housing market.

The stock market started reacting violently to Treasury yields two weeks ago when the 10-year yield surged past 5 percent for the first time since last summer. Wall Street had traded more mildly in recent days as yields retreated from last week's peak of nearly 5.30 percent, but today's yield advance stoked fears that they could resume their climb.

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JOURNAL PUBLISHER TO TAKE OVER NEWS CORP. TALKS

NEW YORK — Wall Street Journal publisher Dow Jones & Co. said today that its board would take over discussions from the Bancroft family, Dow Jones' controlling shareholders, about a potential acquisition by Rupert Murdoch's News Corp.

The announcement came as the far-flung Bancroft family had been hashing out a proposal for News Corp. to set up safeguards to ensure the continued editorial independence of The Wall Street Journal.

The family, which controls Dow Jones' shareholder vote through a class of supervoting shares, has indicated that preserving the Journal's integrity as a news source was its top priority.

After initially rebuffing Murdoch's $5 billion overture in early May, the Bancroft family agreed to meet with him June 5.

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MORGAN STANLEY'S PROFIT UP 39 PERCENT

NEW YORK — Morgan Stanley, the No. 2 U.S. investment bank, today reported fees from advising clients on acquisitions and stock trading lifted second-quarter profit 39 percent from the year-ago period.

For the three months ended May 31, profit after paying preferred dividends rose to $2.57 billion, or $2.45 per share, from $1.84 billion, or $1.75 per share a year earlier.

The record run on stocks this year, and frenzied pace of corporate takeovers, helped lift revenue 32 percent to a record $11.5 billion. Return on equity, a gauge of how effectively the firm reinvests earnings, rose to 27.5 percent from 23.7 percent a year earlier.

Results topped Wall Street projections for a profit of $2.01 per share on $10.03 billion of revenue, according to analysts polled by Thomson Financial.

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CIRCUIT CITY LOSES $54.6M IN FIRST QUARTER

RICHMOND, Va. — Electronics retailer Circuit City Stores Inc. said today it lost $54.6 million in the first fiscal quarter — when it cut jobs to reduce costs and restructured to fend off competition — and withdrew its earnings guidance for 2008.

The results came a day after larger rival Best Buy Co. reported sharply lower first-quarter profit and downgraded its 2008 earnings outlook. Both retailers say the softening economy is steering shoppers away from high-margin items such as flat-screen televisions.

Rising gas prices are having a direct impact on everyday spending, and middle-income shoppers are almost as likely to curb their spending as those with incomes under $50,000, said retail consultant Wendy Liebmann, president of WSL Strategic Retail, which analyzes consumer shopping patterns for retail industry clients.

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FEDEX REPORTS PROFIT DESPITE SLOW BUSINESS

MEMPHIS, Tenn. — FedEx Corp. posted a 7 percent increase in fourth-quarter profit today on higher revenue but said a sluggish U.S. economy dampened business.

The shipping giant forecast earnings growth in fiscal year 2008 below the company's long-term 10 percent to 15 percent target, in part because of planned investments necessary for the company's long-term health.

But FedEx said its own economists predict a bit of an economic upturn later this year.

FedEx shares rose $1.74, or 1.6 percent, to $109.80 today.

FedEx reported earnings of $610 million, or $1.96 per share for the three months ended May 31, up from $568 million, or $1.82 per share, a year ago.

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LARGE GAS, OIL STORES HELP LOWER BARREL PRICES

NEW YORK — Gasoline and oil futures pulled back today after the government reported that gas and crude oil inventories rose by larger-than-expected amounts last week.

Light, sweet crude for July dropped 91 cents to settle at $68.19 a barrel on the New York Mercantile Exchange. That was a turnaround from yesterday, when the contract settled at $69.10, its highest finish since Sept. 1. July oil futures recovered some of their losses late in the session as traders scrambled to cover positions in the expiring contract, said Tim Evans, an analyst at Citigroup Inc.

The August contract, which becomes the front-month contract as of Thursday, fell 68 cents to settle at $68.86 a barrel.

Gas futures for July fell 0.65 cent to settle at $2.2281 a gallon.

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SEC EASES ACCOUNTING REQUIREMENTS

WASHINGTON — Federal regulators today tentatively agreed to ease an accounting requirement for foreign companies that trade on U.S. exchanges.

The action by the Securities and Exchange Commission paves the way for a related change that would allow public companies, when reporting financial results, to choose between international and U.S. accounting standards.