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November 21, 2008 2:57:38 AM CST

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Oil, Fed Leave No Grins, Just Bears

Posted May 21, 08 3:37 PM CDT in Business 

(Newser) – Oil prices kept on pummeling the markets today, and minutes from the Fed's most recent meeting confirmed warnings of higher inflation and lower growth—signaling a pause in rate cuts. "The rise in energy products is going to be the knell for consumer spending," one analyst tells the Wall Street Journal. The Dow ended down 227.49 to 12,601.19, the Nasdaq fell 43.99 to 2,448.27, and the S&P dropped 22.69 to 1,390.71.

The only gainers in the Dow were oil giants Chevron and Exxon Mobil, the Journal adds. Analysts fear that if prices keep rising, consumer spending won't be able to stave off recession. "The stock market has sort of been in denial about this until now. I mean, these prices are punitive," says hedge-fund chief Douglas Kass.

Sources Wall Street Journal, Bloomberg, CNNMoney, Financial Times (UK)

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Mahesa Kumar pumps gas in Portland, Ore., after changing the price of premium gasoline to just over $4 a gallon on their marquis Wednesday, May 21, 2008.   (AP Photo/Don Ryan)
Federal Reserve Chairman Ben Bernanke speaks during a Federal Reserve Bank of Chicago conference in Chicago, Thursday, May 15, 2008.   (AP Photo/Charles Rex Arbogast)
A taxidermy exhibit of bear "Bruno" is shown in a glass cabinet at a nature museum in Munich, southern Germany, on Wednesday, March 26, 2008.   (AP Photo/Christof Stache)
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