Stocks Slip as Crude Oil Sinks 11/28 13:22
A drop in crude prices tugged down shares in oil and gas companies on
Friday, leading the Standard & Poor's 500 index to a slight loss in a short
NEW YORK (AP) -- A drop in crude prices tugged down shares in oil and gas
companies on Friday, leading the Standard & Poor's 500 index to a slight loss
in a short trading session.
The index, a benchmark for many investments, still closed out November with
its third-best month this year.
"Crude is the big story today," said JJ Kinahan, TD Ameritrade's chief
strategist. "There are very clear winners and losers. The Chevrons and Exxons
of the world are getting hammered; then on the other side you have the shipping
companies -- UPS and FedEx -- along with the airlines. For them, it's a
The S&P 500 index lost 5.27 points, or 0.3 percent, to close at 2,067.56. As
a group, energy companies lost 6 percent, the worst drop of the 10 sectors in
the S&P 500 by far.
The Dow Jones industrial average inched up 0.49 of a point, a sliver of a
percent, to 17,828.24. The Nasdaq composite picked up 4.31 points, less than
0.1 percent, to 4,791.63.
The stock market closed at 1 p.m. Eastern time Friday.
Rising corporate profits and a steadily improving U.S. economy have helped
push the stock market to record highs this month. The S&P 500 index, a widely
used gauge for investment performance, ended November with a 2.5 percent gain.
But it was a quiet climb, a combination of many small steps. There wasn't a
single day in November that the index rose more than 1 percent.
The U.S. stock market had Thursday off for the Thanksgiving holiday. So the
main news driving trading on Friday was a decision made Thursday by the OPEC
oil cartel to keep production at 30 million barrels a day. That announcement
hit oil prices hard as traders expect the global supply of oil to stay high.
Crude oil slumped 8 percent to $67.46 in the late afternoon.
The recent slump for oil prices has had a double-edged effect on the market.
It has given a boost to airlines, shippers, retailers and cruise lines, which
benefit from both falling costs and customers having more money in their
pockets to spend. But it has battered drillers, producers and other companies
that provide services to the oil and gas industry.
It was the same story Friday. United Parcel Service gained 3 percent, and
FedEx added 2 percent.
Around the world, the slide in crude prices pulled oil and gas companies
down. Newfield Exploration lost 16 percent and QEP Resources 15 percent, the
two steepest drops by any company in the S&P 500 index.
In Asia, China's state-owned oil giant CNOOC, the country's biggest crude
producer, plunged. In Europe, shares in Royal Dutch Shell, Total and other
energy giants fell.
Despite those steep drops, Europe's major markets ended with slight gains.
France's CAC 40 added 0.2 percent, while Germany's DAX inched up 0.1 percent.
In the U.K, the FTSE 100 index of leading British companies barely moved from
the previous day.
"The template for equity markets today has been clear from the beginning,"
said Alastair McCaig, market analyst at IG. "Oil and energy manufacturers are
down, while those companies that are oil consumers are up."