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Stocks fall as Bernanke warns about oil prices

Stocks fall as Bernanke warns about oil prices

Stocks fell Tuesday after construction spending dropped to its lowest level in nearly a decade and Federal Reserve Chairman Ben Bernanke said rising oil prices could hurt the economy.
Bernanke, in testimony to the Senate Banking Committee, said a prolonged increase in crude prices could pose a risk to the recovery. But he predicted only a temporary increase in inflation, not runaway prices. The Fed chief also said he expected the economy to grow this year, but not at a pace fast enough to quickly lower the 9 percent unemployment rate.
The Commerce Department reported that builders began work on fewer homes, offices and commercial projects in January. The annual rate was near its lowest level 10 years.
The Dow Jones industrial average fell 47 points, or 0.4 percent, to 12,180 in early trading.
The Standard & Poor's 500 index fell 5, or 0.4 percent, to 1,322. The Nasdaq composite index fell 14, or 0.5 percent, to 2,769.
Bond prices fell, pushing yields higher. The yield on the 10-year Treasury note rose to 3.45 percent from 3.42 percent late Monday.
Fifth Third Bancorp fell 6 percent after the regional bank said that the Securities and Exchange Commission was investigating its accounting and reporting of commercial loans.
Natural gas driller Range Resources Corp. fell 4 percent after the company's fourth-quarter revenue figures came in below analysts' expectations. Natural gas prices have been in a slump for the past year as a result of an oversupply in the market.
AutoZone Inc. rose 2 percent after the auto parts retailer said its second-quarter income rose 20 percent as its revenue increased.
U.S. automakers are also releasing their February sales results throughout the day. Automotive website Edmunds.com and J.D. Power and Associates predict that automakers will say sales rose 20 percent in February from the same time last year. Financial analysts say car companies are beginning to offer more discounts and incentives to boost sales.
Homebuilder Hovnanian Enterprises Inc. releases its results after the market closes. Analysts predict that the company will likely report a loss for the quarter as it continues to face soft demand for its homes.


Updated : 2021-10-21 14:21 GMT+08:00