By Ellis Mnyandu NEW YORK, Nov 3 (Reuters) - The Nasdaq rose on Monday as investors snapped up biotechnology shares following broker upgrades on Biogen's (BIIB.O: Quote, Profile, Research, Stock Buzz) stock, but the Dow and the S&P 500 were little changed on concerns that the economic downturn might be deepening. A report showing U.S. manufacturing shrank further in October heightened fears of a deeper recession, a day before the U.S. presidential election. The Institute for Supply Management said its index of national factory activity fell to 38.9 in October, a 26-year low, from 43.5 in September. For more see [ID:nN03319221]. The level of 50 separates contraction from expansion. "Pretty grim. It means we're in a recession, it's as simple as that ... a pretty solid manufacturing recession," said Robert Macintosh, chief economist at Eaton Vance Corp in Boston. "I don't think the data adds anything that already wasn't in the thought process of investors. We are in a recession, the question is how long or deep is it going to be?" The Dow Jones industrial average .DJI shed 9.48 points, or 0.10 percent, to 9,315.53. The Standard & Poor's 500 Index .SPX slipped 2.91 points, or 0.30 percent, to 965.84. The Nasdaq Composite Index .IXIC edged up 5.68 points, or 0.33 percent, to 1,726.63. Shares of energy companies weighed on both the Dow and the S&P 500, with Chevron Corp (CVX.N: Quote, Profile, Research, Stock Buzz) declining 2.1 percent to $73. The drop in energy shares coincided with a decline in oil prices as investors worried an economic downturn would translate into less energy demand. Shares of Exxon Mobil Corp (XOM.N: Quote, Profile, Research, Stock Buzz) shed 1.5 percent to $73.03 as U.S. crude for November delivery CLc1 lost $1.94, or nearly 3 percent, to $65.87 a barrel. Shares of plane maker Boeing (BA.N: Quote, Profile, Research, Stock Buzz) dropped 1.7 percent to $51.42 on the New York Stock Exchange after Goldman Sachs added the stock to a "conviction sell" list, according to theflyonthewall.com. The broker action overshadowed news of a deal ending a strike that crippled Boeing's Seattle area plants for 57 days. [ID:nN01421815] But shares of Biogen, among stocks seen positioned to fare better in a slumping economy, jumped 8 percent, putting the stock among the Nasdaq's standouts. Deutsche Bank recommended a "buy" on Biogen, while Robert W. Baird, a research firm, raised its view on the company to "outperform" from "neutral." Shares of Gilead Sciences (GILD.O: Quote, Profile, Research, Stock Buzz), another biotech company, climbed 2.6 percent to $47.05, as those of Amgen (AMGN.O: Quote, Profile, Research, Stock Buzz) climbed 2.4 percent to $61.31. Elsewhere, shares of Wal-Mart Stores (WMT.N: Quote, Profile, Research, Stock Buzz) rose 2 percent to $56.97 after a brokerage raised its rating on the retailer. Citigroup raised its rating on chipmakers, including Nvidia Corp (NVDA.O: Quote, Profile, Research, Stock Buzz), whose stock jumped 2.4 percent to $8.96, and Integrated Device Technology (IDTI.O: Quote, Profile, Research, Stock Buzz), up 3.8 percent to $6.60 on Nasdaq. Investors are bracing for Friday's report on October U.S. nonfarm payrolls. Democratic contender Barack Obama heads into Tuesday's voting in a comfortable position, with Republican opponent John McCain struggling to overtake his lead in every national opinion poll and to hold off his challenge in about a dozen states won by President George W. Bush in 2004. Obama leads McCain in six of eight key battleground states, including the big prizes of Florida and Ohio, according to a series of Reuters/Zogby polls released on Monday. (Additional reporting by Herb Lash; Editing by James Dalgleish)

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