US Stocks Touch New Lows for the Year
 Reuters
| | The Dow Jones industrial average dropped 79.95 points, or 0.76 percent, to 10,405.70. The Standard & Poor's 500 Index dropped 8.92 points, or 0.76 percent, to 1,165.36. The Nasdaq Composite Index dropped 18.64 points, or 0.94 percent, to 1,973.88. |
New York - US stocks touched new lows for the year this week, as higher oil prices reignited fears about corporate profits, while heavy equipment makers such as Caterpillar Inc. tumbled.
The Nasdaq notched a fresh low for 2005, closing at its lowest since October 2004. The Standard & Poor's 500 hit a fresh low for the year before recouping some losses, while the Dow ended at its lowest in about 2 months.
Caterpillar tumbled 4.7 percent, down $4.42 to $89.80, after Morgan Stanley issued a report saying such stocks may be near their peak. Manufacturer Ingersoll-Rand Co Ltd. (IR.N: Quote, Profile, Research) fell nearly 2 percent, or $1.79 to $78.98.
Another negative for stocks was crude oil reversing course and bouncing into positive territory. Crude for May delivery settled up 18 cents at $54.23 a barrel, reversing an earlier fall. High oil prices hurt corporate profits and consumer spending and generally weigh on equities.
The Dow Jones industrial average dropped 79.95 points, or 0.76 percent, to 10,405.70. The Standard & Poor's 500 Index dropped 8.92 points, or 0.76 percent, to 1,165.36. The Nasdaq Composite Index dropped 18.64 points, or 0.94 percent, to 1,973.88.
Also dragging on stock markets was a report that U.S. consumer confidence fell slightly in March, as higher gasoline prices dampened the mood of car-reliant Americans.
In addition, investors were cautious ahead of Friday's keenly anticipated jobs report for March.
"There are continuing concerns about the possibility of higher inflation down the road, while investors are clearly focused on the data on Friday on payroll," said Ned Riley, chief investment officer of Riley Asset Management.
He added that there was "still some disappointment that we haven't seen a greater price erosion" in oil.
"Today's weakness prevails in the steels, metals and capital goods manufacturers, which have been the darlings of the market for an extended period of time," said Riley.
"The scenario, if carried out to its most negative extent, would be that inflation continues to be the target of the Federal Reserve, and the Fed starts to accelerate the increase in interest rates. Then, the choking off of this fairly buoyant recovery would have its most severe impact on cyclicals stocks." |
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Business News | April 2005 
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