According to CBS Marketwatch "Crude-oil futures have strung together a history-making two-day price run. Friday's 7% gain is attributed in part to talk of an Iran attack and in part to a Morgan Stanley forecast for $150 oil by July 4."
The Oil price surge had begun earlier and Dow started going down as Alfred E. Goldman, Chief Market Strategist at Wachovia Securities points out.
The Dow and Nasdaq are stumbling badly at midsession as the skyrocketing price of oil and a surge in the May unemployment rate dealt the market a one-two punch. The Dow has been down by as many as 300 points. The Nasdaq has been down as many as 48 points. Currently, the Dow is down 2.3%, the S&P 500 is down 1.9%, and the Nasdaq is down 1.8%.
The price of oil soared by more than $6 per barrel as the dollar fell and an Israeli cabinet official warned an attack on Iran may be inevitable. The U.S. unemployment rate rose to 5.5% in May, the biggest rise in more than two decades. The dollar declined following the labor report on reduced expectations the Federal Reserve will hike interest rates.
Energy stocks dominate the list of top performers today. Peabody Coal rose 2.00 to 79.00. Pride International rose 1.39 to 45.38. On the technology front, National Semiconductor rose 1.63 to 24.29 after the company reported better-than-expected earnings. Homebuilding and consumer finance stocks are on the most-declined list.
The NYSE was 4-1 negative on issues and 6-1 negative on volume. The Nasdaq was 5-2 negative on issues and 8-1 negative on volume. Treasuries rose on a flight to safety bid. The 10-year Treasury note was up 29/32 to yield 3.93%.
