Posted on: Thursday, June 23, 2005
Stocks hold ground despite oil concerns
By Ellen Simon
AP Business Writer
NEW YORK — Wall Street's fixation with oil prices left stocks little changed yesterday, although investors managed to react stoically to the government's report of a drop in crude inventories.
"The market is searching for meaning out of the news and isn't ready to forecast where they think oil prices will be," said John Caldwell, chief investment strategist for McDonald Financial Group. "It's a reactive situation."
A barrel of light crude settled at $58.09, down 95 cents on the New York Mercantile Exchange.
Worries linger on Wall Street that high oil prices could accelerate inflation. United Airlines, a unit of UAL Corp., said yesterday it is raising fares on most domestic and international flights by 3 percent, effective immediately, because of rising oil prices.
"People are myopically focused on higher energy prices and are ignoring the generally good fundamentals for the U.S. equity market," said Steve Neimeth, a portfolio manager at AIG SunAmerica Asset Management.
Investors nervous about a possible economic slowdown in the United States bid bonds higher worldwide. The dollar fell against the euro. Gold prices fell as well.
Advancing issues led decliners issues roughly 8 to 7 on the New York Stock Exchange, on volume of 1.85 billion shares, up from 1.73 billion on Tuesday.
Oil futures traded above $59 a barrel after the U.S. Department of Energy released data showing inventories of crude fell 1.58 million barrels for the week. The drop, while lower than expected, initially rattled traders and sent stocks sliding; however, they soon recovered most of their lost ground.
