Dow Skyrockets as Oil Retreats

Deep-seated concerns about economy remain
By Nick McMaster,  Newser Staff
Posted Aug 5, 2008 3:23 PM CDT
A television screen on the floor of the New York Stock Exchange announces the Federal Reserve interest rate decision, Tuesday Aug. 5, 2008.    (AP Photo/Richard Drew)
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(Newser) – Stocks rallied today after the Fed said it would keep money cheap for the time being and crude prices fell to below $120 a barrel, a 3-month low. The Dow gained 330.80 to close at 11,614.95, the Nasdaq rose 64.27 to 2,349.83, and the S&P 500 climbed 35.72 to settle at 1,284.77.

Of the Dow’s 30 components, only energy titan Chevron declined, MarketWatch reports. The Institute for Supply Management’s index of service-sector activity rose to 49.5 in July from 48.2 in June, beating expectations but still below the growth threshold of 50. While today’s rally is good news, traders remain cautious about energy prices, inflation, and hobbled growth.