Oil, Gold Drop; Stocks Rally

123jump.com Staff
02 Sep, 2008
New York City

U.S. stocks edged more than 1% after a drop in crude oil price. The oil prices fell more than 6% after dropping 4% yesterday. Other commodities prices fell as well dragging stocks of oil and metals mining companies. Transportation stocks rose. UAL, AMR, Delta and railroad companies reached higher. The Reserve Bank of Australia cut its key lending rate by 25 basis points for the first time in seven years.

[R]11:55AM New York – U.S. stocks edged more than 1% higher on falling crude oil prices that dragged base metals and other commodities prices lower. Australia cut its key lending rate for the first time in seven years.[/R]

Crude oil futures fell sharply for the second day as fears of hurricane related damage to oil installation subsided in the Gulf of Mexico. The immediate delivery oil futures fell 6.2% or $7.01 after dropping as much as 8.5% in the morning to $108.42 a barrel. In yesterday’s trading oil prices dropped more than $4 a barrel.

The drop in crude oil prices lifted railroads, airlines and other transportation companies. UAL, AMR and Delta jumped more than 5% in the morning trading. UAL jumped $1.47 to $12.57, AMR the parent of American Airlines increased $1.10 to $11.44 and Delta ((DAL)) added $1.00 to $9.13.

Oil complex and commodities miners fell after oil declined in the morning trading. Exxon Mobil fell $1.34 to $78.67, ConocoPhillips ((COP)) dropped $2.71 to $79.81 and Tesoro Corp declined 37 cents to $18.18. McDermott International ((MDR)) dropped $3.23 to $31.55.

BHP Billiton ((BHP)) dropped $6.10 to $64.41, Vale ((RIO)) dropped $1.15 to $25.41 and Rio Tinto ((RTP)) declined $36.90 to $342.91.

Google Inc ((GOOG)) surged $13.88 to $477.19 after it said that it plans to release Internet access browser competing directly with Microsoft Explorer browser and others.

Asian Markets Review

The Reserve Bank of Australia cut its interest rate by 25 basis points to 7%, a first rate reduction in the last seven years. Weakening economy, falling retail sales and declining business confidence may have contributed to the decision by the central bank. The economy of $1 trillion is tightly linked to the Chinese economy and the fears of Chinese economic slowdown after the Olympics Games have dragged the confidence in Australia.

The Nikkei 225 Index in Tokyo closed lower 224.71 or 1.75% to 12,609.47, Hang Seng index in Hong Kong increased 136.15 or 0.65% closed to 21,042.46.ASX 200 index in Australia decreased 2.30 or 0.04% to close 5,116.00. The KL Composite index in Malaysia decreased 13.51 or 1.23% closed to 1,086.99.

The Kospi Index in South Korea decreased 7.29 or 0.52% to close at 1,407.14, SET index in Thailand closed lower 12.21 or 1.81% to 675.22 and JSE Index in Indonesia decreased 5.57 or 0.26% to 2,159.05. The Sensex index in India increased 551.35 or 3.80% closed to 15,049.86.

Europe Markets Review

In London FTSE 100 Index traded lower 2.20 or 0.04% to 5,600.60, in Paris CAC 40 Index increased 54.69 or 1.22% to 4,526.82 and in Frankfurt DAX index traded higher 91.46 or 1.42% to 6,513.26. In Zurich trading SMI increased 95.29 or 1.32% to 7,323.04.


DHT Maritime Inc, operates a fleet of double hull tankers reported second quarter revenues rose 25.53% to $27.8 million from $20.7 million a year ago. Net income in the quarter increased 28.15% to $10.3 million or 29 cents per diluted share compared to net income of $7.4 million or 25 cents per share, a year ago.

DHT Maritime Inc ((DHT)) in the last one year traded as high as $15.74 in October 2007 and as low as $8.39 in August 2008. Based on the yesterday’s closing price the company has a market cap of $338.85 million.