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Dow Skyrockets as Oil Retreats

Deep-seated concerns about economy remain

By Nick McMaster, Newser Staff

Posted Aug 5, 2008 3:23 PM CDT

(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.

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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)

Jeffrey Vasquez, right, and fellow traders work on the floor of the New York Stock Exchange after the Federal Reserve interest rate decision, Tuesday Aug. 5, 2008. (AP Photo/Richard Drew)

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The stock market is range-bound but volatile at the moment, which tells you that people really aren't sure what to make of the risks out there. - John Kosar, Asbury Research

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Dow Skyrockets as Oil Retreats