Oil prices fell in late trading to close lower after being up most of the day on U.S. supply concerns, the slumping dollar and mounting tensions in Pakistan and northern Iraq.
Buyers hesitantly returned to stocks. But a flight to quality after the murder of Pakistani opposition leader Bhutto kept gold up, while oil also rose.
Benazir Bhutto's killing will boost perceived risk in nuclear-armed Pakistan, analysts warned, but some said it was not in itself surprising enough to substantially change investor sentiment.
Analysts say the shock of the Bhutto news triggered a classic capital flight to assets that are considered safe havens in times of geopolitical stress.
Oil rose past $97 a barrel before pulling back to just below that mark Thursday, as U.S. crude stocks fell and geopolitical tension mounted after the killing of Pakistani opposition leader Benazir Bhutto.
Pakistan's Election Commission barred former prime minister Nawaz Sharif on Monday from a Jan. 8 general election because of his criminal record but he did not rule out his party's participation in the vote.
Pakistan said it would hold a national election by mid-January and President Pervez Musharraf pledged to quit the military after criticism from the United States for imposing emergency rule.
Pakistan braced for protests against emergency rule on Monday, while President Pervez Musharraf faced mounting pressure from the United States to hold parliamentary elections in January.
Singapore Telecommunications, Southeast Asia's leading telecoms group, agreed to buy a 30% stake in Warid Telecom, Pakistan's No. 3 mobile operator, for $758 million.