US stocks mixed; oil price concern persists

ABS-CBN News

Posted at Jun 27 2008 11:01 PM | Updated as of Jun 28 2008 07:01 AM

Agence France-Presse

NEW YORK - US shares were mixed Friday following a heavy selloff a day earlier as investors continued fretting over world oil prices which have surged to record highs above 142 dollars a barrel.

The benchmark Dow Jones Industrial Average index -- which has slumped over 13 percent so far this year -- struggled for momentum as oil prices and lingering economic worries continued to weigh on Wall Street.

The Dow was down 12.13 points (0.11 percent) at 11,441.29 at 1440 GMT after sinking a hefty 3.03 percent a day earlier.

The technology-heavy Nasdaq composite had gained a slight 1.20 points (0.05 percent) to 2,322.57 while the Standard & Poor's 500 broad-market index was up 4.21 points (0.33 percent) at 1,287.36.

"The stock market is understandably concerned about high oil prices and weak balance sheets at financial institutions. Market sentiment remains very poor," analysts at Briefing.com said.

Global shares dived Thursday amid concerns that soaring oil prices will crimp economic growth, and as worries persisted about the health of large US banks, some of which have endured multibillion dollar losses tied to a persistent housing slump.

Crude shot to all-time peaks over 140 dollars before retreating Friday and some analysts believe oil prices could vault even higher in coming months.

The strong rise in oil costs over the past year has already forced big US airlines, Detroit automakers and other firms to overhaul their business models amid growing consumer angst about rising energy costs.

Stocks gained some support from an economic report which showed US consumer spending rose 0.8 percent in May, partly as Americans spent the proceeds of tax rebate checks.

Some economists say, however, that the world's biggest economy will face enduring problems once the one-off rebates and spending boost from a 168-billion-dollar economic stimulus expire later this year.

On the corporate front, Anheuser-Busch's stock was up 1.5 percent at 62.26 dollars after the US beer giant rejected a 46-billion-dollar takeover offer from Belgian-Brazilian rival InBev as "financially inadequate" on Thursday.

Anheuser-Busch officials said InBev's offer undervalued the company's assets and business prospects.

In other stock action, Bank of America was up 0.8 percent at 25.00 dollars. General Motors was 0.2 percent lower at 11.41 dollars and ExxonMobil was 0.9 percent higher at 87.20 dollars.

Bond prices weakened as the yield on the 10-year US Treasury bond dropped to 4.016 percent from 4.033 percent Thursday and that on the 30-year bond eased to 4.585 percent against 4.603 percent.

Bond yields and prices move in opposite directions.