Wall Street fell moderately Monday in an erratic session dominated by worries about inflation, which were somewhat soothed by a steep drop...

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NEW YORK — Wall Street fell moderately Monday in an erratic session dominated by worries about inflation, which were somewhat soothed by a steep drop in the price of oil.

The Dow Jones industrial average lost 42.17 to 11,284.15, but it had been down more than 100 points in early trading.

Microsoft, one of the 30 Dow stocks, sank 16 cents to close at $25.28. Boeing, also a Dow stock, fell 65 cents to $61.36.

Broader stock indicators also declined. The Standard & Poor’s 500 index fell 11.30 to 1,249.01, and the Nasdaq composite index declined 25.40 to 2,285.56.

Light, sweet crude closed down $3.69, or 2.9 percent, to settle at $121.41 a barrel on the New York Mercantile Exchange after Tropical Storm Edouard seemed unlikely to threaten oil and natural-gas facilities in the Gulf of Mexico. It was the lowest closing price since May 5 and left crude down nearly 20 percent from its July 11 high of $147.27.

That decline eased some worries about inflation. Wall Street initially sold off after the Commerce Department said an inflation gauge tied to consumer spending rose a sharp 0.8 percent in June, reflecting higher gasoline prices. That was the biggest jump in the indicator since a 1 percent rise in February 1981.

The data came in the report on consumer spending, which fell 0.2 percent in June after removing the effects of higher prices.

The report fed investors’ growing concerns about the impact of rising prices on consumers, whose spending is the lifeblood of the economy.

Richard Cripps, chief market strategist for Stifel Nicolaus, said the economic readings Monday reinforced the negative sentiment in the markets globally.

While the Federal Reserve will hold a regularly scheduled policy meeting today, he said investors don’t expect much from the session that will help an economy stymied by higher prices and the continuing housing slump.

“I don’t think that the Fed can really pull any of its levers to create a short-term fix,” he said.