Stocks slide as jump in oil prices renews worries (AP)

By MATTHEW CRAFT and DAVID K. RANDALL, AP Business Writers Matthew Craft And David K. Randall, Ap Business Writers – Tue Mar 1, 5:46 pm ET

NEW YORK – Stocks suffered steep losses as oil prices surged on Tuesday, renewing worries that higher fuel prices could hobble the economic recovery.

Oil rose $2.66 to settle at $99.63 a barrel amid unrest in Iran and Libya. Iran clamped down on anti-government protesters and forces loyal to Libya's leader Moammar Gadhafi launched counter-attacks against rebels expanding control over the country.

Prices jumped 13 percent last week with a rise in turmoil across North Africa and the Middle East. That pushed gas prices up 20 cents per gallon. As a result, Americans are now paying roughly $75 million more per day to fill their gas tanks than a week ago.

Federal Reserve Chairman Ben Bernanke told the Senate Banking Committee that a sustained increase in crude prices could pose a risk to the recovery. But he predicted only a temporary increase in inflation, not runaway prices. The Fed chief also said he expected the economy to grow this year, although not enough to lower the 9 percent unemployment rate.

The Commerce Department reported that builders began work on fewer homes, offices and commercial projects in January. The annual rate was near its decade low, set in August.

The Dow Jones industrial average lost 168.32 points, or 1.4 percent, to 12,058.02.

The Standard & Poor's 500 index fell 20.89, or 1.6 percent, to 1,306.33. The Nasdaq composite fell 44.86, or 1.6 percent, to 2,737.41.

Three stocks fell for every one that rose on the New York Stock Exchange. Consolidated trading volume came to 4.8 billion shares.

Fifth Third Bancorp dropped 4.5 percent after the regional bank said that the Securities and Exchange Commission was investigating its accounting and reporting of commercial loans.

Natural gas driller Range Resources Corp. lost 7 percent after the company's fourth-quarter revenue figures came in below analysts' expectations. Natural gas prices have been in a slump for the past year as a result of an oversupply in the market.

AutoZone Inc. rose 2 percent after the auto-parts retailer said its second-quarter income rose 20 percent as its revenue increased.

On Monday, stable oil prices and more signs of a stronger economy helped lift. All three major stock indexes ended February higher, marking their third straight month of gains. The S&P 500 index had its best start to any year since 1998.

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Stocks recover as crude oil prices stabilize (AP)

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Stocks recover as crude oil prices stabilize (AP)

NEW YORK – Stocks rose Friday as oil prices stabilized following a recent jump. The escalating turmoil in Libya still left major indexes down about 2 percent for the week.

Oil prices settled at $97.88, down from a high of $103 Thursday but still up 13 percent over the last week. Oil prices have been rising, sending stocks lower, as concerns rose that violence would spread throughout North Africa and the Middle East, affecting oil production for big OPEC producers like Iran and Saudi Arabia.

Those concerns eased late Thursday after the International Energy Agency said the impact was far less than analysts had estimated and that any shortfall could be easily made up by tapping oil reserves in other countries.

Boeing Co. rose 2.2 percent after the Air Force awarded the company a $35 billion contract Thursday, one of the largest ever made by the military, for nearly 200 airborne refueling tankers.

DreamWorks Animation SKG Inc. fell 2.8 percent after the entertainment company reported revenue and earnings that were far below what analysts were expecting. Poor box office results from the Will Ferrell movie "Megamind" were partly to blame.

The Dow Jones industrial average rose 61.95, or 0.5 percent, to close at 12,130.45. It was the first rise for the Dow after three days of losses.

The Standard & Poor's 500 index rose 13.78, or 1.1 percent, to 1,319.88. The Nasdaq composite rose 43.15, or 1.6 percent, to 2,781.05

All three indexes are still down for the week, largely a result of the fighting in Libya.

Libya is Africa's largest producer of oil but only ranks 15th among the world's oil exporters. Traders have been concerned that fighting could not only threaten Libya's oil production but also spread to other countries in the region such as Saudi Arabia.

Higher oil prices also weigh on the U.S. economy by increasing the costs of moving goods and filling up gas tanks. A sustained $10 increase in the price of oil translates into a 0.2 percent cut in economic growth over 12 months, according to a recent estimate by economists at Goldman Sachs.

Treasurys inched up Friday on reports the economy grew more slowly than first thought in the last three months of 2010. The yield on the 10-year Treasury note edged down to 3.42 percent from 3.46 percent late Thursday.

The Commerce Department said the economy expanded at an annual rate of 2.8 percent in the October-December quarter. That's weaker than the previous estimate of 3.2 percent. In an attempt to close budget gaps, state and local governments have cut spending much more deeply than previously thought.

Despite this week's slide, the S&P 500 is up 2.6 percent in February and 4.9 percent for the year. Stronger earnings from a wide range of companies, including Archer Daniels Midland Co. and Dell Inc., have helped drive stocks higher.

Five stocks rose for every one that fell on the New York Stock Exchange. Consolidated volume was 3.9 billion shares.

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