Oil Prices Fall Below $15 to 5-Year Low : Market Overview
Crude oil futures prices tumbled below $15 a barrel to a five-year low on Thursday on a published report that Iraq would be willing to consider a one-time sale of $1.6 billion worth of crude.
* The stock market managed to close modestly higher after coasting through an uneventful session during which major performance gauges stayed stuck near neutral.
* Long-term bond yields rose moderately ahead of job statistics that many market participants fear will show an unexpected jump in company payrolls last month.
Commodities
Light sweet crude oil moved steadily lower during the day, with contracts for delivery in January settling at $14.95 per barrel, down 53 cents at the New York Mercantile Exchange. It was the lowest closing level since $14.92 on Nov. 29, 1988. Crude has fallen more than $2 per barrel in the last two weeks.
The report, in the industry newsletter Petroleum Intelligence Weekly, triggered sustained selling on fears of an early re-entry of Iraq to a market already facing large supplies.
Petroleum Intelligence Weekly reported that Iraq would consider the one-time sale if the U.N. were limited to monitoring the distribution of food and humanitarian aid by the Iraqi government. Iraq’s U.N. ambassador later denied the report, the Knight-Ridder financial wire service reported.
Elsewhere, gold prices were up overseas and down in New York. On the New York Comex, gold closed at $373.80 an ounce, off $1.00 from Wednesday and silver finished at $4.613, off 3.5 cents.
Other Markets
Analysts attributed the stock markets’ dull tone to reluctance on the part of investment professionals to make commitments ahead of potentially market-moving employment data which is due out today.
Concerns that an improving economy could push up interest rates blunted the buying enthusiasm inspired by lower oil prices and strength in stocks overseas.
The Dow Jones average finished with a gain of 5.03 at 3,702.11 and close to its best reading of the session. Trading slowed and volume on the floor of the New York Stock Exchange came to 253.08 million shares. Meanwhile advancing Big Board issues outpaced declines by about 7 to 5.
One plus for Wall Street was a continuing recovery in Tokyo’s stock market. Tokyo’s Nikkei average finished at 17,458.75 up 333.44 points. The Frankfurt market finished at a record closing high. The DAX-30 average closed up 20.66 points at 2,110.53. In London, the Financial Times 100-share average ended 9.3 points down at 3,223.9.
Among the market highlights:
* Shares of retailers were active after reporting November sales. Limited fell 3 3/8 to 18 on news its sales dropped 7%, and the company said earnings for the year would decline. Sears dipped 7/8 to 54 1/8, and Dillard Department Stores fell 1 1/8 to 39 1/2.
* Other actively trading retailers were Wal-Mart, which fell 5/8 to 27 7/8, and Merry-Go-Round, which jumped 1 1/8 to 6 1/2.
* International Paper dropped 5/8 to 66 7/8. PaineWebber downgraded the stock to unattractive from neutral.
* Among high-tech stocks on the Nasdaq, Newbridge rose 2 1/8 to 56, Qualcomm added 1 7/8 to 58 1/2 and Cisco gained 1 3/4 to 59 3/8.
* One of the day’s biggest losers was Medimmune, which tumbled 7 to 16 on the Nasdaq market. Investors dumped the stock after a Food and Drug advisory panel concluded that the company needs to do further clinical trials on its respiratory drug RespiGam.
Market Roundup, D6
Daily diary
Interest Rates:
1-year T-Bill: 3.58%
New York Volume: 256.37 million shares
30-year T-Bond: 6.28%
