Stocks wobbled to a mixed finish yesterday as dramatically lower oil prices offset a government report that offered new evidence of rising...
NEW YORK — Stocks wobbled to a mixed finish yesterday as dramatically lower oil prices offset a government report that offered new evidence of rising inflation.
The Dow Jones industrial average finished down 14.49 at 10,456.02, after edging in and out of positive territory for much of the day. The Dow fell 94.88 on Tuesday amid growing inflation concerns.
Microsoft, one of the 30 Dow stocks, gained 19 cents to close at $24.18 a share. Boeing, also a Dow stock, fell 37 cents to $56.85.
The broader gauges eked out small gains. The Standard & Poor’s 500 index closed up 0.82 at 1,172.53. The Nasdaq composite index added 0.88 to 1,990.22.
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The Labor Department’s reading of its Consumer Price Index (CPI) showed a higher-than-expected 0.4 percent rise for February, adding to inflation concerns raised by Federal Reserve policy-makers on Tuesday. It was the last thing investors wanted to see, but the sharp drop in oil and the fact that much of Wall Street’s inflation fears had been priced into stocks during the previous session kept the market from posting precipitous declines, analysts said.
“Probably the most important factor today is energy,” said Arthur Hogan, chief market analyst at Jefferies. “If we had this move in the commodity in a vacuum, I think we would have a market that was up a couple hundred points. The CPI is keeping that from happening, but the good news is we’re not selling off.”
Oil dropped $2.22 to $53.81 per barrel on the New York Mercantile Exchange, as a weekly government report showed a larger-than-expected build in crude supplies. Gold dropped more than $6 to $425.20, and the U.S. dollar rose sharply against other major currencies following the Fed’s decision Tuesday to raise short-term interest rates to 2.75 percent.
The increase in the CPI, the government’s most closely watched inflation barometer, came after prices edged up by just 0.1 percent in January. Economists had forecast a 0.3 percent rise. Although sharp increases in energy costs — including gasoline — led the way in February, many other prices, including those for airfare, medical care, and education, also went up. The “core” CPI, which excludes energy and food, rose 0.3 percent, its largest increase since September.
“I think the Fed got a chance to review the CPI numbers [Tuesday], so I think that was baked into their actions already,” said Jack Ablin, chief investment officer at Harris Private Bank. “Still, this is the worst [CPI] report we’ve seen for six months. Core is up 2.4 percent year-over-year, and it’s ratcheting higher and creating concern.”