Posted on: Tuesday, April 5, 2005
Stocks climb modestly as oil settles below $58
By Michael J. Martinez
Associated Press
NEW YORK — Stocks managed to squeeze out modest gains in a volatile session yesterday as crude oil futures, which briefly topped $58 per barrel in early trading, settled lower. A rare piece of good news for embattled Dow Jones industrial American International Group Inc. helped blue chips make gains.
Yet oil remained a source of concern for investors, who fear that crude prices in the high $50 range could eat into consumer spending, prompting either an economic slowdown or rising prices that could trigger inflation. And there was no real sign that oil would decline substantially.
"It's hard to say where that line in the sand is, that level for oil prices where the market will seriously sell off," said Scott Wren, equity strategist for A.G. Edwards & Sons. "I do think that if you have sustained levels of $60 to $65, then the market will be very hard pressed to make any move to the upside."
The concerns about higher oil prices drew attention away from ChevronTexaco Corp.'s $16.4 billion acquisition of oil explorer Unocal Corp., the reported sale of Morgan Stanley's Discover Card division and the possibility of a renewed bidding war for MCI Inc.
Advancing issues outnumbered decliners by nearly 5 to 4 on the New York Stock Exchange, where consolidated volume came to 2.13 billion shares, compared with 2.24 billion Friday.
Oil prices again kept investors on edge after reaching a new intraday high of $58.28 early in the morning. After fluctuating throughout the session, oil futures settled at $57.01, down 26 cents, on the New York Mercantile Exchange.
