$100 Oil Extinguishes Rally

After three-digit gain, the Dow ends down

By Sam Gale Rosen, Newser Staff

Posted Feb 19, 2008 4:11 PM CST

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$100 Oil Extinguishes Rally — Shopping carts are gathered outside the Wal-Mart Stores Inc. in Brunswick, Maine, on Tuesday, Feb. 19, 2008. The world's largest retailer announced its renewed focus on low prices has paid off with a 4-percent rise in profit for its fourth quarter. (AP Photo/Pat Wellenbach) (Associated Press)

After three-digit Dow gains, today's record surge in oil prices knocked out a broad rally, and the major indexes closed in the red. Analysts say the market won't be able to sustain a prolonged rally for some time. "The rallies we're seeing now are just bounces, not a new trend," a strategist tells the Wall Street Journal. The Dow ended down 10.99 at 12,337.22, the Nasdaq 15.60 at 2,306.20, and the S&P 500 1.21 at 1,348.78.

Oil set a record, toppping $100 a barrel, following an explosion at a Texas refinery yesterday and worries that OPEC may cut production at its March 5 meeting. "Investors are starting to get nervous and selling riskier stocks," an asset manager told Blooomberg. Meanwhile, mixed news from Wal-Mart and OfficeMax made things even more complicated for investors. (Read more stock market stories.)

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