Libya worries push US stocks down a 2nd day
NEW YORK—US stocks dropped on heavy volume Wednesday as worries about Libya depressed global markets and drove up crude prices to two-year highs.
Airline shares were hammered for a second day over the prospect of higher fuel costs, while oil companies gained for the same reason.
The Dow Jones Industrial Average lost 107.01 points, (0.88 percent), to 12105.78, after trading down nearly 150 points during the session.
The broader S&P 500 gave up 8.04 points (0.61 percent), while the tech-focused Nasdaq lost 33.43 (1.21 percent) at 2,722.99.
“Increasingly violent political protests in Libya amplified fears of contagion in the Middle East,” said Andrea Kramer of Schaeffer’s Investment Research.
“What’s more, the geopolitical turmoil in the oil-saturated region heightened concerns about significant supply disruptions.”
Most airline shares lost six to seven percent on the prospect of higher fuel costs, after similar losses Tuesday.
AMR Corp, parent of American Airlines, fell 6.6 percent; United Continental lost 6.8 percent and US Airways 7.4 percent.
Delta, to the contrary, picked up 2.61 percent after a favorable ruling in a passenger lawsuit.
Oil shares meanwhile rose sharply with the prices of crude on the world markets, with ExxonMobil gaining 1.9 percent and Chevron adding nearly two percent.
Computer giant Hewlett Packard finished down 9.6 percent after its disappointing results were announced following the close on Tuesday.
Ford Motor Co. lost 2.43 percent after announcing a recall of 150,000 F-150 pickup trucks for faulty airbags.
The bond market moved sideways after rising Tuesday on Libya worries.
The yield on the 10-year Treasury bond sat at 3.487 percent against 3.461 percent late Tuesday, while the 30-year was 4.598 percent against 4.605 percent.
Bond prices and yields move in opposite directions.
