Stocks slip again on rising oil prices

• Article
• Comments ()
• Click-2-Listen
• Videos

By

NEW YORK -- Stocks fluctuated before closing slightly lower yesterday after a Federal Reserve governor's upbeat comments on inflation helped ease worries about a bleak forecast from Intel Corp. The major indexes finished mixed for the week.

The market first fell on Intel's news, but rallied after Fed Vice Chairman Roger Ferguson suggested that core price inflation was under control and hinted at a moderating fiscal policy from the central bank. An afternoon rise in oil prices -- which fed Wall Street's concerns about inflation -- eroded those gains.

Meanwhile, news that the nation's service sector grew faster than expected last month countered a drop in consumer confidence, lending some stability to a market stifled recently by concerns about more interest-rate increases and rising energy costs.

"In general, there's still a decent amount of momentum coming off the start of the year, which typically tends to support the market," said Steven Goldman, chief market strategist for Weeden & Co. "Stocks should hold up well, assuming we don't get a sharp rise in long-term [bond] rates here."

At the close of trading, the Dow Jones industrial average lost 3.92, or 0.04 percent, to 11,021.59.

Broader stock indicators also finished lower. The Standard & Poor's 500 index dropped 1.91, or 0.15 percent, to 1,287.23, and the Nasdaq Composite Index slid 8.51, or 0.37 percent, to 2,302.60.

The Russell 2000 index of smaller companies fell 1.72, or 0.23 percent, to 738.44.

Bonds fell for a third session, with the yield on the 10-year Treasury note rising to 4.69 percent from 4.64 percent late Thursday. The dollar was mixed against other major currencies, while gold prices tumbled.

Crude-oil futures advanced as heightening political tension overseas created supply fears for the energy market. A barrel of light crude added 31 cents to settle at $63.67 on the New York Mercantile Exchange.

The Institute for Supply Management said its nonmanufacturing index climbed 3.3 points to 60.1, compared with economists' expectation of 58. Meanwhile, the University of Michigan reported its consumer sentiment index slipped 0.7 points to 86.7, while economists had predicted a 0.1 point rise.