Posted on: Wednesday, August 4, 2004
Spike in oil prices ends Dow's winning streak
By Eileen Alt Powell
Associated Press
NEW YORK — Another record high for oil prices and a sharp drop in consumer spending rattled investors yesterday, sending stocks lower and halting a five-session winning steak for the Dow industrials. Technology stocks suffered the worst damage.
Stocks have been trading in a narrow range in recent weeks as investors worry about rising interest rates and energy prices. And although the market overcame Monday's jitters over oil prices and new threats of terrorism, sellers prevailed as the backdrop worsened yesterday.
As oil prices continued to climb, investors feared that consumers and businesses could face even higher fuel costs in coming months.
The contract for September delivery of light crude rose 33 cents to $44.15 on the New York Mercantile Exchange, the third straight closing record. On London's International Petroleum Exchange, September Brent crude rose 67 cents to a new high of $40.64.
Meanwhile, the Commerce Department reported that consumers slashed their spending in June by the largest amount in three years, reinforcing other recent indications that the economic recovery slowed at the end of the second quarter.
Declining issues outnumbered advancers by a 6-to-5 margin on the New York Stock Exchange, and by a 2-to-1 ratio on the Nasdaq stock market. Preliminary consolidated volume on the NYSE came to 1.62 billion shares, compared with 1.57 billion shares on Monday.
The market, already fretting over the impact of fuel costs on corporate profits, took another blow as U.S. crude prices jumped above $44 a barrel for the first time.
