Stocks climb as oil prices ease

The IEA vows to release excess inventory if the Libya crisis hurts supplies. US GDP grows less than expected. Boeing rallies on a tanker contract. Gold prices drop.

By TheStreet Staff Feb 25, 2011 8:40AM

Image: Wall Street sign (© Comstock Images/age fotostock)TheStreetBy Melinda Peer, TheStreet

 

Updated at 12:39 p.m. ET

 

Stocks were rising Friday as oil prices eased after oil-producing nations vowed to release reserves if violence in Libya disrupts supplies.

 

At 12:39 p.m., the Dow Jones Industrial Average ($INDU) was up 52.8 points, or 0.4%, at 12,121. The S&P 500 ($INX) was up 113. points, or 0.8%, at 1,317 and the Nasdaq ($COMPX) was rising 36.2 points, or 1.3%, to 2,774. 

 

Oil came down from $100 a barrel after the International Energy Agency said it would release excess oil inventory if the conflict in Libya hurts supplies. President Barack Obama also said the U.S. would be able to withstand any supply disruptions. Reports that Saudi Arabia was working on compensating for the shortfall in Libyan oil production also eased concerns. 

The North African country has been divided amid political unrest against Moammar Gadhafi's long rule. Crude oil for April delivery was falling 7 cents to $97.28 a barrel.

 

The U.S. economy grew by 2.8% in the fourth quarter, according to the Labor Department's second estimate. The fourth-quarter expansion was downwardly revised from the government's initial estimate for growth of 3.2%, and well below the increase of 3.3% that economists had been expecting, according to Briefing.com. U.S. gross domestic product grew 2.6% in 2010's third quarter.

 

Paul Ballew, economist at Nationwide Insurance, said the latest estimates confirmed that the recovery will be slow. ”The recovery has a lot of weight on its back. It will be gradual and choppy,” said Ballew who expects the economy to grow at 3% to 3.2% in 2011. He said imbalances that triggered the recession would take a long time to correct. “We are still seeing a drag from housing. The residential sector typically contributes 10% to 12% of GDP. We are getting no contribution from that sector.”

 

Markets received a more positive reading on consumer sentiment. The Michigan Consumer Sentiment Index rose to 77.5 in February, its highest level in over three years. Economists were expecting the reading to remain unchanged at 75.1.

 

Hong Kong's Hang Seng jumped 1.8%, and Japan's Nikkei added 0.7%. London's FTSE was gaining 1.5%, and the DAX in Frankfurt was ahead by 0.9%. 

 

Shares of Boeing (BA) were gaining 2.3% at $72.40 after the aircraft maker won a $35 billion contract to build aerial refueling tankers for the Air Force late Thursday.

 

Bank of America (BAC), DuPont (DD) and Intel (INTC) were also leading on the Dow. Johnson & Johnson (JNJ)Wal-Mart (WMT) and Chevron (CVX) were the biggest losers on the Dow.

 

American International Group (AIG) said late Thursday that it posted a profit in the fourth quarter. AIG reported net income of $16.60 a share, compared with a loss of $65.51 a year earlier. However, the gains came largely from the sales of its overseas unit, with its core insurance business turning a weaker performance. Shares were down 5.8% to $38.08.

 

Late Thursday, Salesforce.com (CRM) hiked its full-year sales outlook after exceeding Wall Street's expectations with adjusted earnings of 31 cents a share on sales of $457 million. The stock was adding 3.8% to $139.40.

 

Shares of Interpublic (IPG) was the biggest gainer on the S&P after it said it would buy back $300 million of its shares. The stock was up 7.8% at $12.53.

 

The April gold contract was falling by $8.30 at $1,407.50 an ounce.

 

The benchmark 10-year Treasury was down by 4/32, lifting the yield to 3.462%. The dollar strengthened against a basket of six currencies, with the dollar index up by 0.2%.

 

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185Comments
Feb 25, 2011 10:54AM
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Alternative energy for me this spring, summer and fall is riding my bicycle (anywhere possible) just like I did  when I was a kid.

 

 

 

That way $3,$ 4 or $ 5 dollar gas per gallon,  for the most part can stick it!

Feb 25, 2011 10:54AM
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I am with miragy get rid of the gas tax so we can privatize all roads and make them toll roads the only other option or get rid of roads entirely---
Feb 25, 2011 10:50AM
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cowboy...Why is it that you think the 400 richest families do not deserve what they have? Every man and woman in this country has the opportunity in life if they take it to be successful and get rich....that is what sets the USA apart from a lot of nations.....it all has to do with the drive inside a person to get there. I do not like the destruction of the  middle class going on in this country but to constantly blame it on the rich is just not fair. What wealth (or poor) status you have has nothing to do with values. All the talk out of the current administration about redistributing the wealth in this country is not good for the middle class either. People in this country need to start taking care of themselves and stop looking to the government to take care of them. I truly believe that everyone is where they want to be in life, some just don't want what others may or they do not take advantage of what they have inside them to make it happen.

Feb 25, 2011 10:47AM
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What?? the market is not functioning efficiently? Sometimes I wonder, Which should we should give up. I think that these are pretty average for where I live.

Real Estate Tax                              $5,000

Real Estate Insurance                  $   900

HOA                                                   $  500

Total RE expenses                        $6400

 

Car Gas                                           $5200  (at 3.08/gal two cars)

Insurance car (two)                        $1740

Total Car                                           $6940

Total for car and RE                      $12840

 

Total Income Tax                           $10,500

                    

Feb 25, 2011 10:47AM
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Gas prices...

 

Want them lower by a buck, get RID of the gas tax.  I know the liberals will argue, we need the money for roads, but after all the shovel ready infrastructure money blown repaving roads, we can go without for awhile...

 

Also, in a few weeks, we will be paying another 20-25 cents a gallon for EPA mandated 'Summer" formulation.   we could eliminate this this year...

 

Perhaps we should just buy oil company stocks, and enjoy our spend our profits on gas...

 

Or maybe we should USE LESS?  Maybe someone will develop an alternative.   But lets not have the government throw taxpayer dollars down multiple rat holes that will not pan out....Considering we have been doing just that since Carter tell me stop reinforcing failure...

Feb 25, 2011 10:42AM
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Futures are up on Wisconsin passing the bill taking a step towards killing the middle class. The average union worker gets 45k yearly--wow that's is way too much--yet the 400 richest families in the U.S. is worth more than 150,000,000 Americans a hundred and fifty million on the bottom but that is alright--What a messed up set of values this country has--that is why you are going to see it continue to slide to a 3rd world country--so no crying with values like that and voting in people who strip the middle class of dignity.......................
Feb 25, 2011 10:39AM
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greed balls are just like snow balls they run downhill and gather more as they go they get bigger and bigger until they destroy whatever is in thier path including the us economy
Feb 25, 2011 10:33AM
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Yeah, all BS, the price of barrel goes down yet gas gets jacked up over 10 cents a gallon overnight in my area. 100% complete joke.
Feb 25, 2011 10:32AM
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As with the last one, here's hoping you're wrong. LOL
Feb 25, 2011 10:31AM
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Don't forget we still have Spring Break, Easter weekend,Summer and Summer fuel regs, Hurricane Season, just to name a few of good old time fuel excuses to RISE!!! So nice to have things to look forward to!!!
Feb 25, 2011 10:27AM
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 . Retail gas went up almost 30 cents per gallon in the last 24 hours where I live, not sure if this is occurring nationally or just regionally or locally.  Diesel is now approaching $4/gallon, it's like deja vu, it's like deja vu, it's like deja vu, it's like deja vu...

 

Up fifteen cents in the last 24 hours where I am.

Feb 25, 2011 10:23AM
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I see ECF's disability is starting to flare up again.
Feb 25, 2011 10:21AM
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And if Saudi Arabia joins the chaos in a couple of weeks as rumored, we could easily hit $4.00 by 4/1.

Here's another prediction by 2 sick.  Smile
Feb 25, 2011 10:21AM
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everyone on here is posting about how they use less gas and the facts bear that out. us is down12% year over year on gas consumption there is curently a oil surplus on the world market if gas or oil were based on a supply/demand curve the price would be declining but its not allowed.its manuplated by billionares and treated as a commodity to be speculated and a greed ball results greed balls are unstopable because the greed begets more greed and so on
Feb 25, 2011 10:15AM
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Bull Rider I have a better idea,let's quit paying taxes,because as alot of others I have cut back to the point of just being able to EXIST.  But yet my taxes are still paid to people having alot more fun off of my money than I am!! Life is about LIVING NOT EXISTING!!

Feb 25, 2011 10:11AM
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You know I am being sensitive lately about this gas thing because every time I go to gas up the price raises and then after I's done the price goes down. How do they know that I am going to need Gas when I need it.

 

Why am I sensitive, because one of my progeny once said to me some years back when I got on it because of bad grades..... Its all my fault.. :(

Feb 25, 2011 10:11AM
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bull rider im with you im packing my dog and me up the creek and were doing some gold panning total cost 0 might even make a few bucks for all you 100lb girls in 6000lbs trucks all i can say is to refi your house and buy another 12 mpg rig from gm you can park it in the front yard and show it off to all your other 20 somethings smart people
Feb 25, 2011 10:02AM
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can you say depression all thats required is for gas to go up another 50 cents in a week bring it on koch bros you can wipe your **** with all those paper dollars
Feb 25, 2011 10:01AM
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Bull Rider...people have to go to work....many drive into the city from where I live to get work...way too far (about 35 to 40 miles) to hike, bike etc. Most I know are just doing the basic driving they have to do these days. I know I have really cut back on my driving and make sure to make lists to get all I need in one trip...others are doing the same.
Feb 25, 2011 9:59AM
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Gas in Wis is $3.26, it was $3.14 last Saturday
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