NEW YORK (AP) — Volatile crude oil prices kept stocks under pressure yesterday, leaving the major indexes with a slight loss. Questions over economic growth and the upcoming election weakened the U.S. dollar and contributed to investors’ uncertainty.
The dollar slid to an eight-month low early yesterday as foreign investors worried that the tight presidential race and the still-rising price of oil could further hurt the U.S. economy. Overseas stock markets fell sharply, and Wall Street extended its slide from last week.
While oil prices, which topped $55 per barrel for the first time last week, managed to fall somewhat yesterday, many analysts believe they are still too high and will start to weigh heavily on the economy should they remain above $50. A barrel of light crude was quoted at $54.54, down 63 cents, on the New York Mercantile Exchange after rising as high as $55.67.
“For the first time, you’re really starting to see companies mention oil in their earnings reports this quarter,” said Chris Johnson, manager of quantitative analysis at Schaeffer’s Investment Research in Cincinnati. “Up until now, high oil prices have been little more than a nuisance for investors. Now, it’s shaping up to be a real problem.”
The Dow Jones industrial average fell 7.82, or .08 percent, to 9,749.99, setting a fresh year-to-date low for the Dow in its lowest close since Nov. 24.
Broader stock indicators finished narrowly lower. The Standard & Poor’s 500 index was down .94, or .09 percent, at 1,094.80, and the Nasdaq Composite Index lost 1.10, or .06 percent, at 1,914.04. The Russell 2000 index of smaller companies was up 3.89, or .69 percent, at 571.67.
Despite oil futures falling, the uncertainty over the economy and the elections accentuated negative earnings reports, while overshadowing any good news. Telecommunications company BellSouth Corp. saw its profits fall 14.6 percent in the third quarter on flat revenue, and the company missed Wall Street’s profit forecasts by 2 cents per share. BellSouth slipped 13 cents to $26.42.
Consumer products maker Kimberly-Clark Corp. fell $4.03 to $59.03 after it missed analysts’ estimates by a penny per share, despite a 5 percent rise in profits.
Kellogg Co. had better news, as the cereal and snack producer beat Wall Street expectations by 4 cents per share in the latest quarter and increased its profit forecasts for the rest of the year as well. Kellogg rose 74 cents to $43.15.
Advancing issues outnumbered decliners by nearly 5 to 4 on the New York Stock Exchange, where preliminary consolidated volume came to 1.72 billion shares.
Overseas, Japan’s Nikkei stock average fell 1.82 percent. In Europe, Britain’s FTSE 100 closed down 1.1 percent, France’s CAC-40 slid 2.05 percent for the session, and Germany’s DAX index tumbled 2.12 percent.
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