Wall Street turned lower Wednesday as investors worried that a sharp jump in oil prices could be another sign that consumers are under stress...
NEW YORK — Wall Street turned lower Wednesday as investors worried that a sharp jump in oil prices could be another sign that consumers are under stress in an economy that is already showing signs of a recession.
The Dow Jones industrials fell 48.53 to 12,605.83 after changing direction several times. Microsoft, one of the 30 Dow stocks, fell 34 cents to close at $29.16 a share. Boeing, also a Dow stock, gained 97 cents to $76.85.
Broader market indexes fell. The Standard & Poor’s 500 index fell 2.65 to 1,367.53 while the Nasdaq composite index fell 1.35 to 2,361.40.
The major indexes, which spent most of the session in a tight trading range, tumbled after oil prices shot higher in response to the Energy Department’s report of an unexpected jump in gasoline demand. That could lead to higher prices at the pump, a troublesome trend given that retail gas prices are expected to rise anyway as the summer approaches.
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Consumer spending, which makes up about two-thirds of the U.S. economy, is watched closely by the Federal Reserve. Earlier Wednesday, Fed Chairman Ben Bernanke said he expects the economy to contract in the first half — a trend that would mean the U.S. is in a recession.
Crude oil rose $3.85 to settle at $104.83 a barrel on the New York Mercantile Exchange.
“The oil uptick took away some of the optimism that we’ve seen recently,” said Richard Cripps, chief market strategist for Stifel Nicolaus. “Higher gasoline price would mean less in the pocket for Americans, and there’s also continued worries about a recession.”
The credit crisis and weak economy have sent stocks tumbling over the past six months. But the market had shown some renewed confidence that the worst of the credit problems might be behind Wall Street. That upbeat sentiment sent stocks up nearly 400 points Tuesday.
Some of the pullback late Wednesday also was pinned on profit taking after that big advance.
The dollar was mixed against other major currencies, while gold fell slightly.