Oil's jump, UPS warning spark sell-off
|
| Posted
:
Wed, 09 Apr 2008 20:40:00 GMT |
| Author
:
Reuters |
| Category
:
US (Business) |
| News Alerts by
Email ( click
here ) |
|
|
|
|
|
By Kevin PlumbergNEW YORK (Reuters) - Stocks fell on Wednesday after United Parcel Service Inc slashed its earnings forecast and oil prices hit a record high above $112 per barrel, darkening the outlook for corporate results.UPS cited both the dismal economic outlook and high fuel prices for its downbeat assessment, feeding fears that fallout from the U.S. housing slump and credit crisis was spreading.Shares of UPS, considered a bellwether of U.S. economic activity, lost 3.7 percent and along with rising oil prices dragged the transport sector lower. The drop in UPS was its biggest daily decline since July 2006.U.S. crude oil futures surged after government data showed a surprising draw on crude stockpiles last week.General Electric Co , which will report its results on Friday, also declined and was the heaviest drag on the S&P 500. Caterpillar Inc and United Technologies Corp , whose shares are sensitive to fluctuations in energy prices, were among the heaviest weights on the Dow."Engineering and construction companies are under pressure. The reason is the perception that they are not going to be spared," said Stanley Nabi, vice chairman of Silvercrest Asset Management Group in New York."All of these deep industrials are under pressure on the fear that this downturn we are in is going to broaden beyond housing," he said.An exception to the dark scenario was Boeing Co., whose shares rose 4.8 percent to $78.60 after the aircraft manufacturer said its 787 Dreamliner jet would be delayed by not as much as the market had expected. Boeing was the top-weighted gainer in both the Dow and the S&P 500.The Dow Jones industrial average <.DJI> was down 49.18 points, or 0.39 percent, ending the day at 12,527.26. The Standard & Poor's 500 Index <.SPX> was down 11.05 points, or 0.81 percent, finishing at 1,354.49. The Nasdaq Composite Index <.IXIC> was down 26.64 points, or 1.13 percent, at 2,322.12.GE shed 1.4 percent to $36.44 on the New York Stock Exchange.UPS shares ended at $70.57, down $2.74, on the NYSE.The S&P retailers index <.RLX> declined 2.3 percent, down for the fifth consecutive day, its longest losing streak since late December 2007.The Dow Jones Transportation Average <.DJT> was down 3.5 percent as well, falling for four straight days."The markets are pricing in a scenario in which the swoon is worse than expected. The markets are worried about the extent and duration of the recession," said Joseph Quinlan, chief market strategist for the investment management unit of Bank of America in New York.Morgan Stanley helped drag down financials. The investment bank said that more of its assets became illiquid or hard to value during the first quarter.Shares of Morgan Stanley dropped 2.6 percent to $46.10, while an S&P index of financial stocks <.GSPF> slid 1.8 percent."That's part of the weakness. Morgan Stanley is putting a little more concern back into financials," said Michael James, senior trader at regional investment bank Wedbush Morgan in Los Angeles.On Nasdaq, shares of Research In Motion Ltd , the maker of the BlackBerry, declined 2.3 percent to $118.16. The stock was started with a "hold" rating at Needham, a brokerage.Apple Inc , down 0.9 percent at $151.44, also weighed on the Nasdaq. Earlier this week, Apple received its sole "underperform" rating, from Morgan Keegan.Volume was modest on the New York Stock Exchange, where only 1.22 billion shares changed hands, far below last year's estimated daily average of 1.90 billion. On the Nasdaq, about 1.92 billion shares traded, below last year's daily average of 2.17 billion.Decliners outnumbered advancers on the NYSE by a ratio of more than 2 go 1, while on the Nasdaq, nearly three stocks fell for every one that rose.(Reporting by Kevin Plumberg; Editing by Jan Paschal)
(c) Reuters 2008. All rights reserved. Republication or redistribution of Reuters content, including by caching, framing or similar means, is expressly prohibited without the prior written consent of Reuters. Reuters and the Reuters sphere logo are registered trademarks and trademarks of the Reuters group of companies around the world.
|
|
|
|
|
|
|
|
|
