- The Washington Times - Friday, December 3, 2004

NEW YORK (AP) — Stocks edged higher yesterday as another drop in oil prices helped Wall Street withstand the effects of a disappointing jobs creation report. The major indexes achieved a second straight week of gains.

Crude oil futures continued their decline, falling below the $43-per-barrel mark for the first time in 21/2 months. A barrel of light crude settled at $42.54, down 71 cents, on the New York Mercantile Exchange, raising hopes that a continued slide in oil prices would lift an economy weighed down by high energy costs.

Oil’s performance helped investors look past a worrisome jobs report. The Labor Department said there were 112,000 new jobs in November, far less than the 200,000 Wall Street expected. Furthermore, October’s blockbuster gains of 330,000 were adjusted down to 307,000.

“Certainly, the jobs number was a surprise, but it’s still a positive,” said Jack Ablin, chief investment officer at Harris Private Bank in Chicago. “It still demonstrates that our economy is moving forward and creating jobs. And oil’s been a nice boost this week as well.”

The Dow Jones Industrial Average gained 7.09, or 0.07 percent, to 10,592.21.

Broader stock indicators were narrowly higher. The Standard & Poor’s 500 Index was up 0.84, or 0.07 percent, at 1,191.17, and the Nasdaq Composite Index gained up 4.39, or 0.2 percent, at 2,147.96.

While the economic news has been disappointing, Wall Street managed to post gains for the week thanks to a 13 percent drop in crude oil futures over the past three sessions. For the week, the Dow gained 0.67 percent, the S&P; 500 was up 0.72 percent and the Nasdaq rose 2.19 percent.

Jobs and oil have been Wall Street’s biggest concerns in the second half of the year. With gasoline and other energy prices unusually high, consumers have been less willing to spend, as seen by the sluggish start to the holiday shopping season. And without more spending, companies have been less willing to create new jobs, which would mean more consumers with disposable income.

However, investors remained bullish on stocks, with inflows of capital continuing to climb since the presidential election.

“It’s not really rational right now, because the fundamentals of the market don’t match up with the sentiment out there,” said Chris Johnson, manager of quantitative analysis at Schaeffer’s Investment Research in Cincinnati. “The cash that’s been poured into the market starting with the election has just been a buoying force. You’ve got an overbought market that’s going to remain overbought.”

Tech stocks gained traction after Intel Corp.’s bullish mid-quarter update, released late Thursday. The semiconductor giant and Dow component said its revenues would be substantially higher than Wall Street expected. Intel surged $1.20, or 5.28 percent, to $23.91.

Sign up for Daily Newsletters

Manage Newsletters

Copyright © 2019 The Washington Times, LLC. Click here for reprint permission.

Please read our comment policy before commenting.


Click to Read More and View Comments

Click to Hide