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Category: Money

US Stock Market Dropped and Oil Price Hikes as Libya Protest Intensifies

Written on February 23, 2011 by Japhet Writ

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Stocks fell sharply last Tuesday and oil prices spiked, as investors became worried about increasingly violent protests in Libya.

Last Tuesday, the sharply dropped while oil price increased due to intensifying protests in . Oil price rose to $95 per barrel after the revolt threatened the oil production in the country. The fall of stock market and the worries traders that the protests in will spread to other oil-rich countries.

In addition to this, Airline companies are concerned that the oil price hike could lead to higher fuel cost. According to Alan Gayle, senior investment strategist at RidgeWorth Investments, “This puts a damper on consumer optimism, which is really critical at this stage of the recovery.”

Dow Jones, in particular, dropped 0.4 percent in the morning trading. Delta Air Lines Inc., AMR Corp., United Continental Holdings Inc. and US Airways Group Inc. all fell by five percent. Retail stores like Wal-Mart and book seller Barnes & Nobles’ stocks also dropped. The continuous setback of the US stock market raises concerns about the country’s ability to turn around its business this year.

And although the consumer confidence index rose to its highest point in three years, home prices in majority of cities fell to their lowest levels since the housing bubble burst.

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