Dow industrials drop 270 to lowest level of year
OPEC President Chakib Khelil was quoted as telling a French television station that oil could rise to between $150 and $170 per barrel this summer before pulling back later in the year. That and a falling dollar helped send light, sweet crude up $3.96 to $138.51 a barrel on the New York Mercantile Exchange. Rising oil has saddled nearly all parts of the economy with higher costs, weighing on consumers who now have to reach much deeper into their wallets at the gas pump and therefore have less to spend elsewhere.
Oil is our nemesis here. Nearly every other indicator has shown some sort of improvement. We should have seen this coming back in 1967. Instead we got leaders content with maintaining the status quo.The latest reading on the gross domestic product Thursday backed up that fear. The Commerce Department said the economy as measured by GDP rose at 1 percent annual rate in the first quarter, a slight improvement from the previous estimate of 0.9 percent, but still quite anemic. Moreover, the number does not reflect the impact of higher gas and oil prices that shot up further during the second quarter, which ends Monday.
"This is unfortunately kind of a slack period. We're waiting for second-quarter earnings. Until then, we have this very negative attitude among investors and everyone seems to be latching onto negative news and shrugging off the positive news," said Jack Ablin, chief investment officer at Harris Private Bank in Chicago, pointing to the uptick in housing sales.
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