Oil surges, stocks fall as Middle East erupts [Updated]
Financial markets worldwide on Friday finally began to pay attention to the uprisings in the Middle East. Stocks tumbled and some investors fled back to gold and other hard assets.
[Updated at 2:45 p.m.: All data below now reflect closing market figures.]
The biggest reaction was in the oil market: U.S. crude futures, which on Thursday had sunk to a two-month low amid rising domestic inventories, jumped $3.70, or 4.3%, to $89.34 a barrel in New York.
Gold, which has been hit by profit-taking all month since reaching a record high of $1,422.60 an ounce on Jan. 3, was up $22.30, or 1.7%, to $1,340.70 in a classic “flight to safety.”
Investors also ran back to U.S. Treasury securities, pushing the yield on the 10-year T-note down to 3.32% from 3.38% on Thursday.
On Wall Street, stocks were dragged lower by worries about the Middle East and by a string of disappointing fourth-quarter earnings reports, including those from Ford Motor Co., Microsoft Corp. and Amazon.com.
It also didn’t help the market that the government’s first estimate of fourth-quarter U.S. economic growth came in at 3.2%, weaker than the 3.5% consensus estimate, despite a surge in consumer spending.
In Europe, most major stock markets lost between 1% and 1.5%. Many emerging markets were down more sharply, as usual in a broad sell-off. Turkey fell 2.8%, the Mexican market was off 1.6% and Brazil was down 2%.
-- Tom Petruno
Photo: Protests in Cairo on Friday. Credit: Mohamed Omar / European Pressphoto Agency