NewsMine — economy — united-states — 2005 — 2005-apr-july — Viewing Item

Stocks head lower on surging oil Original Source Link: (May no longer be active)    http://www.businessweek.com/ap/financialnews/D898MFIG0.htm?campaign_id=apn_home_down http://www.businessweek.com/ap/financialnews/D898MFIG0.htm?campaign_id=apn_home_down The Associated Press/NEW YORK By MICHAEL J. MARTINEZ AP Business Writer Stocks head lower on surging oil prices APR. 4 12:13 P.M. ET Wall Street started the week with another decline as surging oil prices intensified investor fears that rising energy costs would eat into economic growth. Oil's move higher overshadowed ChevronTexaco Corp.'s $16.4 billion bid for Unocal Corp. Crude oil futures rose above $58 in electronic trading, setting their second straight intraday trading record. Prices retreated slightly once the session opened, with a barrel of light crude quoted at $57.80, up 53 cents, on the New York Mercantile Exchange. "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, which investors worried would lead to rising inflation, drew attention away from ChevronTexaco's acquisition of oil explorer Unocal, the possibility of a renewed bidding war for MCI Inc. and news of a possible acquisition of Morgan Stanley. At midday, the Dow Jones industrial average fell 12.57, or 0.1 percent, to 10,391.73. Broader stock indicators also lost ground. The Standard & Poor's 500 index was down 1.99, or 0.2 percent, at 1,170.93, and the Nasdaq composite index dropped 7.23, or 0.4 percent, to 1,977.58. Bonds managed slight gains as oil prices climbed, with the yield on the 10-year Treasury note falling to 4.44 percent from 4.45 percent late Friday. The dollar rose against most major currencies, while gold prices fell. Merger and acquisition activity is usually seen as a sign of a growing and healthy economy, but with oil prices substantially higher, not even ChevronTexaco's move for Unocal, which valued the company at $62 per share, was enough to move the market. Unocal tumbled $4.78 to $59.57 due to the relatively low valuation, while ChevronTexaco lost $2.03 to $57.28. Morgan Stanley climbed 71 cents to $57.58 after a London newspaper reported that HSBC Holdings, the British banking company, might be interested in acquiring the embattled Wall Street brokerage house, though analysts said such a deal could be unworkable for HSBC, which fell 23 cents to $78.39. Morgan Stanley's board also issued a vote of confidence in the company's leadership, countering a new letter from dissident shareholders calling once again for the departure of Chief Executive Philip Purcell. MCI Inc. rose 2 cents to $25.31 after it said it will reopen talks with Qwest Communications International Inc., despite having agreed to a $7.6 billion takeover bid by Verizon Communications Inc. Qwest, which sweetened its offer to nearly $9 billion, added 11 cents to $3.75, while Verizon was up 18 cents at $35.37. Analysts at Morgan Stanley and Salomon Smith Barney upgraded insurer American International Group Inc., saying the recent investigations into its accounting and trading practices have driven its stock price low enough to be considered a bargain. AIG rose 20 cents to $51.15 on the news. General Motors Corp. lost 19 cents to $29.19 after the company said Chairman and CEO Rick Wagoner would take direct control over daily responsibility for the automaker's struggling North America division. Declining issues outnumbered advancers by nearly 2 to 1 on the New York Stock Exchange, where volume came to 691.15 million shares, compared with 737.58 million at the same point on Friday. The Russell 2000 index of smaller companies was down 3.18, or 0.5 percent, at 608.37. Overseas, Japan's Nikkei stock average fell 0.48 percent. In afternoon trading, Britain's FTSE 100 was down 0.35 percent, Germany's DAX index dropped 0.73 percent, and France's CAC-40 lost 0.68 percent. ------ On the Net: New York Stock Exchange: http://www.nyse.com Nasdaq Stock Market: http://www.nasdaq.com

120 thousand united airline employees lose pensions { May 11 2005 } American obesity sending health costs soaring Consumer prices rise greater than expected Dow has biggest 2 day drop in two years Durable goods orders fall by most in 2 years Economy drags heels and inflations fears rise { April 29 2005 } Fed raises key rate on inflation fears { May 3 2005 } Fed raises rates to 3 and half as measured plan Fed says inflation pressures could be intesnifying { April 12 2005 } General motors shifts engineer positions to brazil { June 29 2005 } General motors to cut 25 thousand jobs { June 8 2005 } Greenspan says fed will keep raising rates Greenspan will keep raising rates he says Housing prices loom as concern { July 20 2005 } Huggies cuts six thousand jobs Industry squeezed by soaring energy prices { June 26 2005 } Kodak lays off 10 thousand workers { July 20 2005 } London blasts help dollar and stock gains Manufacturing slow down boosted stocks they say Manufacturing weakest since 2003 { June 1 2005 } Massachusetts homes sales plunge 11 percent { June 24 2005 } Real wages falling at fastest rate in 14 years { May 10 2005 } Sales of homes hit record as prices soar { May 24 2005 } Snow says oil prices hurting economy { June 28 2005 } States costs soar under drivers license law Stocks continue april decline hitting 2005 lows Stocks fall amid oil price worries { June 21 2005 } Stocks head lower on surging oil Stocks rise on jump in oil prices { June 17 2005 } Student loan interest will double Trade deficit unexpectedly shrank to 55b Trade gap widens more than expected US stocks fall as IBM earnings drag tech shares down US tourism losing billions because of image { May 8 2005 } Wages lagging behind inflation { April 11 2005 } Weak consumer spending damps speculation of quickening inflation Files Listed: 36

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