Wall Street slipped lower but still held on to most of its recent gains yesterday as investors, their confidence in the economy growing...
NEW YORK — Wall Street slipped lower but still held on to most of its recent gains yesterday as investors, their confidence in the economy growing, reacted calmly to oil prices that approached $60 per barrel.
The Dow Jones industrial average fell 13.96 to 10,609.11, ending seven straight sessions of gains which saw the Dow rise 140 points.
Microsoft, one of the 30 Dow stocks, added 7 cents to close at $25.11 a share.
Boeing, also a Dow stock, fell 95 cents to $63.67.
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Broader stock indicators were narrowly lower. The Standard & Poor’s 500 index was down 0.86 at 1,216.10, and the Nasdaq composite index lost 1.98 to 2,088.13. Both indexes reversed five days in positive territory.
Building on last week’s surge in energy prices, crude-oil futures reached a new intraday record of $59.52 per barrel, heightening worries that higher prices at the pump would hurt consumer spending and slow economic growth. A barrel of light crude settled at a record $59.37, up 90 cents, on the New York Mercantile Exchange.
The concern over oil stymied hopes of continuing last week’s stock advance, which saw the major indexes climb for five straight sessions. But Joseph Battipaglia, chief investment officer at Ryan Beck, said investors — who have seen the risk of inflation dwindle and the economy remain on track — were handling the oil situation well.
“Everything else I see, aside from oil, is in place for a good run. Inflation issues have been pretty much satisfied, the Federal Reserve is on a glide path to stopping their interest-rate increases. Everything else looks good,” Battipaglia said. “Stocks aren’t hugely cheap, but they’re still cheap on a relative basis. So if we can get oil back down somewhat, we should be in good shape.”
The Conference Board’s latest reading of the index of leading economic indicators showed that the economy could already be slowing faster than many investors expect. The index for May dropped 0.5 percent, more than the 0.3 percent drop Wall Street had expected. The index was unchanged in April.
“The leading indicators are just confirming what we’re seeing in other indicators, that the economy is not falling off a cliff, but it is slowing,” said Russ Koesterich, senior portfolio manager at Barclays Global Investments in San Francisco.