Stock Futures Fall As Oil Surges

Images (showing 1 of 3 photos)

NEW YORK — Stock futures fell sharply Thursday after Exxon Mobil Corp.'s earnings missed Wall Street expectations and another surge in oil prices tempered the optimism generated by the Federal Reserve's interest rate cut.

Exxon Mobil, the world's largest publicly traded oil company and a Dow Jones industrial, posted a $9.41 billion profit in the third quarter, compared with $10.49 billion a year ago, due to lower natural gas prices and weaker margins in its refining and fuels marketing business. Gasoline prices didn't keep up with the gains in crude in the past quarter, which made refining oil more expensive.

The Dow looked to retreat from a more than 130-point advance Wednesday, when after the Federal Reserve lowered its benchmark interest rate by a quarter point to 4.50 percent. Investors had reason to rally: The central bank simultaneously loosened the money supply and suggested that strains on the financial markets — and economy — have eased.

But the Fed's move began a chain reaction that sent prices higher. Lower interest rates tend to undercut the dollar, which reached an all-time low against the euro following the Fed's decision. The dollar's tumble drove investors to the commodities market in search of a hedge: Oil prices surged above $96 a barrel in electronic trading overnight, while gold prices topped $800 an ounce.

The concern on Wall Street comes in part because Fed cautioned that higher energy and commodity prices could add to inflation pressures. Rising inflation could prevent the central bank from cutting rates further this year.

Dow futures fell 56.00, or 0.40 percent, to 13,880.00. Standard & Poor's 500 index futures shed 11.30, or 0.73 percent, to 1,543.60. Nasdaq 100 index futures lost 10.00, or 0.44 percent, to 2,242.50.

Treasury bond prices rose. The yield on the 10-year Treasury note fell to 4.45, down from 4.47 percent late Wednesday.

Crude oil futures rose 98 cents to $95.51 in preopening trading on the New York Mercantile Exchange. Gold futures fluttered around $795 an ounce, as the dollar rebounded from its lows. The euro bought $1.4412 in early trading Thursday, off its $1.4503 peak.

Investors waded through another heavy day of earnings reports, as well as economic news including figures on pending home sales in September and weekly claims for unemployment benefits.

CVS Caremark Corp., the nation's largest pharmacy chain, said earnings more than doubled in the third quarter due to robust sales at stores open at least one year and improved margins. The results topped market expectations.

Sprint Nextel Corp. posted sharply lower third-quarter profit as its wireless customer base shrunk, resulting in weaker revenue. The company is the country's third-largest wireless provider behind rivals AT&T Inc. and Verizon Wireless.

European markets moved lower. Britain's FTSE 100 fell 0.79 percent, Germany's DAX index shed 0.34, and France's CAC-40 declined 0.71 percent. In Asia, Japan's Nikkei stock average rose 0.79 percent, while Hong Kong's Hang Seng index rose 0.45 percent

Back To Top

	Stocks Plunge on Oil, Credit Worries	Associated Press	Tue Oct 30	0
	Stocks Plunge; Dow Drops More Than 360	Associated Press	Wed Oct 31	0
	Stocks Plunge on Oil, Credit Worries	Associated Press	Wed Oct 31	0
	Stock Futures Slip Ahead of Jobs Report	Associated Press	Fri Nov 2	0
	Fed Cuts Interest Rate by Quarter Point	Associated Press	Wed Oct 31	0