Gold Price Above $900, Oil Sets Record Near $128
May 16, 2008 -- Gold prices have hit $905 an ounce on the New York
exchange market, rising from $882 late last week. Rapidly rising oil
prices, which reached $128 a barrel, have sparked a buying spree.
Silver has also risen in price, reaching $17 an ounce. Earlier this
year gold prices broke the $1,000 an ounce barrier before falling back
again. Financial analysts believe gold could hit $2,500 an ounce
within a few years.
THE RISING PRICE OF OIL isn't just swelling Americans' energy bills =97
it's also holding back their stock ****tfolios.
Wall Street got some seemingly auspicious signs last week about home
construction and consumer level inflation. But with oil climbing to
new records, and more re****ts expected this week on rising prices and
the housing market, investors are holding on to a conservative stance.
Oil's stubborn trek to record highs is a major reason why investors
have yet to push the major indexes into positive territory for the
year. Just this month, crude has so far tacked on about $13 to breach
$127 a barrel, while the price tag on a gallon of gasoline for the
average U.S. driver has soared 17 cents to nearly $3.79.
Those price surges cast an air of skepticism over last week's re****t
from the Labor Department showing a modest 0.2 percent uptick in
consumer prices in April.
Meanwhile, the Commerce Department's upbeat re****t on housing starts
also met with some doubt among investors, particularly because the
huge rise was due mostly to apartment construction, which can vary
widely from month to month.
Still the market, betting that better times are not that far off,
finished the week with a solid advance. The Dow Jones industrial
average rose 1.89 percent, while the Standard & Poor's 500 index
gained 2.67 percent and the Nasdaq composite index picked up 3.41
percent
"So are we at an inflection point in housing right now? Very possibly.
But let's be clear here. Nothing in the data suggests we're about to
see a sharp rebound," wrote Bernard Baumohl of the Economic Outlook
Group LLC in a research note.
We are still looking for oil to ease off and for the dollar to rise
off
the floor. Without those moves, even if we have good earnings for Q1,
we won=92t be able to assume the consumer can hold up in Q2. (APP)
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