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As violence continued to mount in the Middle East this morning, reports that Saudi Arabia is not planning an oil embargo against the United States helped to ease crude oil prices lower. November light sweet crude oil futures traded on the

New York Mercantile Exchange

were lately down $35.90 from a previous close of $36.06.

After dropping into the red on some hot economic data out this morning, the major indices managed to pull themselves back onto their feet.

The September

Producer Price Index

showed that soaring energy prices sharply raised U.S. wholesale prices in September. This should have exacerbated inflation worries in a nervous market. The September

retail sales

number showed that sales in the U.S. jumped to the sharpest rate in seven months, boosted by car and truck sales and soaring gasoline prices.

But optimism over the drops in oil prices and some good tech earnings numbers released post-close yesterday sent both the

Nadsaq Composite Index and the

Dow Jones Industrial Average soaring into the green shortly after the open.

Positive comments from

Goldman Sachs'

strategist Abby Joseph Cohen on the

S&P 500 index was giving that beleaguered benchmark a lift. The bullish bull said the index is undervalued by about 15% and reiterated her year-end S&P target of 1575.

Money was coming back into some of the Dow's stocks that were hardest hit yesterday, such as financials

J.P. Morgan





and even home-improvement retailer

Home Depot


. Yesterday, the interest-rate financials were hurt on concerns over inflation from rising oil prices, while Home Depot warned it expects to miss third-quarter earnings forecasts. J.P. Morgan was lately up 3% to $140.13; Citigroup was 3.6% higher to $48.44; and Home Depot was up 1.8% to $35.50.

Big techs and telecoms, such as









were also rebounding from yesterday's losses.

Good solid earnings from networking firm

Juniper Networks


, PC-maker



and semiconductor firm

PMC Sierra


were helping all of tech.

Juniper was one of investors' favorites; the stock was climbing 2.6%.

Internet stocks were almost the only ones not joining in the tech parade after Internet marketing company



gave a lackluster forecast for future earnings and was pessimistic about a turnaround in the Internet advertising market.

wrote a

separate story about DoubleClick last night. DoubleClick has lost some 30.3% this morning.

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Sector Watch

It was just another day of rotation on the market, as yesterday's winners became today's losers, and vice versa.

Those sectors that rallied yesterday despite news of violence in the Middle East -- such as drug and tobacco stocks -- weren't getting any love. The

American Stock Exchange Pharmaceutical Index

was down 1.4% to 410.4, and the

American Stock Exchange Tobacco Index

was off 0.9% to 243.4.

The energy stocks were, of course, also in the dumps. The

American Stock Exchange Oil & Gas Index

was 3.2% lower, the

American Stock Exchange Natural Gas Index

was down 1.5% and the

Chicago Board Options Exchange Oil Index

was down 3.1%.

The semiconductors, meanwhile, were back in business, with the

Philadelphia Stock Exchange Semiconductor Index

lately up 4.5%.

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Bond prices turned lower following hotter-than-expected reports on both consumer spending and wholesale prices.

Retail sales increased 0.9% in September, the largest gain since February; they were up 0.7% excluding autos. Economists polled by


had forecast gains of 0.6% overall and 0.5% excluding autos. The data suggests that consumer spending -- the primary driver of economic growth -- continues to run at a strong pace.

Meanwhile, the

Producer Price Index also rose 0.9% in September, the largest gain since February. Oil prices, which rose 3.7%, were largely responsible. The core PPI, which excludes food and energy prices, gained 0.3%. But that gain, too, was larger than expected. On average, economists had forecast the PPI to rise 0.5% overall and 0.1% excluding food and energy. The report fans fears that rising oil prices are leading to a faster rate of inflation overall.

The benchmark 10-year

Treasury note lately was flat at 100 6/32, yielding 5.724%.

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