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Iraq

Wall Street Ends Week Higher on Strong Friday Rally But Still Below All-Time Highs

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Stock market rises on 1% rise in stocks on Friday
It appeared it was going to be another down week for stocks until Friday arrived. The last day of the week produced the best day for the S&P 500 and Dow Jones industrial average since March, and it pulled stocks high enough to post gains for the week. Stock indexes are still well below their all time highs, but the strong end to the week was good news and it’ll send the market into next week on a positive note.

The Dow rose 182.52 points (1.12%) on the day to end the week at 16,550.79, a 0.4% increase for the week. That is still well below the 17,000 barrier it had reached last month, and still slightly lower than where it stood at the beginning of the year.

The S&P 500 gained 21.84 points (1.14%) to end the week at 1,931.41. That was a 0.3% increase for the week, and the best one-day performance since earlier this year. While the S&P 500 had been flirting with the 2,000 point barrier earlier in July, it still has a ways to go before flirting with that milestone again. The S&P 500 remains in positive territory for the year, up over 4%.

The NASDAQ composite increased 36.02 points on Friday (0.83%) to end the week at 4,370.99. That was a 0.4% rise for the entire week for the composite. The NASDAQ, like the S&P 500, remains in positive territory of more than 4% for the year.

The markets seemed to rise on the fact there was positive news out of Russia of easing tensions on the Ukraine border. While the US did say they would, then actually did, carry out new air strikes in Iraq, the announcement seemed to clarify the US stance in the area, and didn’t spook traders into selling.

The big winner of the day was Tekmira Pharmaceuticals Corporation, which saw its stock price surge by just over 45% to $20.70 a share. The large increase came on news that the US Food and Drug Administration (FDA) had cleared the company’s experimental Ebola treatment in humans as part of the current Ebola outbreak crisis management. With nearly 30 million (28.4 million) shares traded on the news, Friday ended up being the busiest trading day for the stock in the company’s history.

Both utilities and energy shares in the S&P 500 sectors also did well on the day. The utility sector secured a 2% gain for the day, while energy secured nearly as much, with a 1.7% increase.

(Photo courtesy of Emilio Labrador)

Gas Prices Look to Ease for Upcoming Fourth of July Weekend

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Gas prices look to remain steady through the Fourth of July weekend
It appears gas prices are beginning to ease a bit with the Fourth of July weekend quickly approaching, but that isn’t likely going to be much of a consolation to those who are out driving for the holiday. Oil prices ended the week on a steady note, and the latest information from AAA is that prices are beginning to ease.

The price of gasoline currently sits at $3.68 per gallon, according to AAA Fuel Gauge report, but is actually down a bit from Friday. At the end of the week, the average price for a gallon of regular unleaded gas sat at $3.681, but today it’s slightly receded to $3.678.

While it appears that the price has crested for the month, and the price will begin to ease back a bit as we head into the Fourth of July weekend (barring any unexpected geopolitical news), drivers are still going to be paying significantly more than they were last year at this time. A gallon of gas was $0.18 a gallon less expensive a year ago, making current gas prices the highest they have been at this time of the year since 2006.

It’s been an unexpected month, and gas prices have risen much more than expected in June. Gas prices traditionally fall in June, and that is what the prediction was for how June 2014 would unfold. That all changed when unrest in Iraq spooked traders into wondering if Iraq’s oil supplies were in peril. That shot oil prices up with the result of keeping gas prices from taking their normal June dip. Now that the Iraq oil supply fears have eased, it looks like prices are ready to begin easing a bit as they should have done earlier. Of course, there are still plenty of unknowns which could quickly change the course of gas prices, especially if increased unrest hits Iraq.

While those looking to take a road trip over the upcoming Fourth of July weekend are going to be paying far more than usual to fill their tanks, it seems that they aren’t going to have to pay more than they are today, and they will likely be able to pay a few cents less.

(Photo courtesy of Steven Damron)

Oil and Gas Prices Hold Steady on Calm Trading Day

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Oil and gas prices end the week steady on easing Iraq fears
It appears as if gas prices might be set to ease just a bit with the Fourth of July weekend quickly approaching. Both oil and gas prices held steady on Friday on what was overall a quiet day for the energy markets. That’s good news where geopolitical unrest has moved the market upward in the preceding weeks.

US benchmark crude oil closed at $105.74 a barrel in New York for August delivery, $0.10 lower than it began the day. There was a slight uptick in the price of Brent crude, which closed at $113.30 a barrel in London, up $0.09 for the day. Brent crude is a benchmark for international oils which are used by many US refineries. Even with the slight increase on Friday, international oils have overall fallen in price over the last few days, and both international and US oils have receded from their all-time highs in 2014. This could be an indication that traders are calming about the geopolitical unrest in Iraq, and don’t have as much fear the conflict will spread to southern Iraq, where much of the oil is produced.

At the same time, the price of gasoline remained at $3.68 per gallon, the same price that held yesterday, according to AAA. While this is $0.20 higher per gallon than it was at the same time last year, it appears it won’t go much higher with the calming oil markets. Still, there isn’t much chance the prices will fall much for the Fourth of July weekend, making gas prices the most expensive they have been since 2006 over this holiday. Traditionally, gas prices fall in June, but this trend was disrupted with unrest in Iraq this year.

There is still a lot of unknowns which could quickly change this current steadiness, especially if unrest escalates in Iraq again. At least for the time being, it appears we may see both oil and gas prices ease and begin to fall in the coming weeks if no other major changes in outlook occur.

(Photo courtesy of Patrick Emerson)

Lundberg and AAA Both Report Slightly Higher Gas Prices

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Lundberg and AAA note gas price increase for the week
The price of gasoline is rising, but it isn’t spiking, at least not yet. Lundberg reported on Sunday gasoline prices in the US rose $0.0187 during the past two weeks. The report noted refiners and retailers absorbed the majority of the costs with rising oil prices coming from the geopolitical conflict in Iraq. Instead of passing those costs onto consumers, they instead chose to absorb the approximately $6 per barrel increase which happened over the last two weeks. By doing this, the margins on gasoline have decreased, and the companies will likely try to regain some of that in the weeks ahead.

At the same time, AAA’s fuel gauge report shows an increase of $0.021 in gasoline prices over the past week. Both reports show gas prices are continuing to rise, but that rise is currently happening at a slow and steady pace, rather than a huge spike.

Gas prices will likely continue to increase as they have been, as long as there are no other major disruptions to scare traders into pumping up crude oil barrels even higher. This could happen with the continuing conflict in Iraq, which continues to simmer.

Rising gas prices in June is an unusual phenomenon. Most of the time, consumers are treated with decreasing gas prices during the sixth month of the year. In fact, the price of gas fell $0.20 on average during June in 2011, 2012 and 2013. It appeared this trend would continue in 2014 until the geopolitical conflict in Iraq sent crude oil soaring in the middle of the month. While there are currently three states in the US where gas is over $4 a gallon already (Alaska, California and Hawaii), it doesn’t appear that any other states will be joining them in the near future.

It’s important to remember that it’s not necessary to accept the higher gas prices without doing anything at all, In fact, there are a large number of steps that you can take to reduce the amount of gas you consume. One of the easiest ways is to use the app Gas Buddy, which tells you where to find the least expensive gas in your area. Just be sure to remember to avoid falling for common gas saving myths, or forget to also consider stations like Costco where it’s possible, using a trick, to buy even if you don’t have a membership. Taking the time to find easy and convenient ways to cut down on your gas consumption should help mitigate the current gasoline increases.

(Photo courtesy of Mark Turnauckas)

Dow and S&P 500 End Week at Record Highs. Will We See More Next Week?

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The Dow and S&P 500 end at record highs for the week
The stock market ended last week in positive territory with the Dow Jones industrial average and Standard & Poor’s 500 index both reaching new record highs. The Dow is up 2.2% for the year and ended the week at 16,947.08, breaking the previous record of 16,945.92 set on June 10, 2014. The S&P 500 is up 6.2% for the year, ending the week at 1,962.87, reaching its highest level for the third day in a row. The NASDAQ Composite, while not reaching an all-time high, managed to end the week at 4,360.04, its highest level in 14 years. The question is, will stocks continue to hit record highs in the week to come?

There are a couple of key areas which may play a large part in determining whether or not stocks continued to climb in the week ahead. First, the street will get to see reports from a couple of consumer discretionary stocks. Their results could be important, as this is the only sector of the S&P 500 which remains negative (down 1.1%) since the beginning of the year. This coming week, retailer Bed Bath and Beyond and sports apparel maker Nike will both report results. Their earnings could be a large factor in how the stock market as a whole does for the week.

Housing data will also probably play a key role on how the market does in the coming week. Monday we’ll see data released on the sales of previously owned US homes. The National Association of Realtors will be releasing this data early Monday morning. On Tuesday morning, the Commerce Department will be releasing data on new home sales in the US. Whether or not this data meets the stock markets expectations will likely have a large influence on if we see another week of record high stock market closes.

Ultimately, however, new records highs for the S&P 500 index and Dow may not have anything to do with new data releases in the US. The weekend has made the likelihood of geopolitical unrest being a major stock market influence more likely. Where the stock market ultimately ends could very well be determined by what happens in Iraq over the next week. With an escalation of fighting over the weekend, and the nation on the verge of an all-out civil war, the unrest and geopolitical problems there could easily trump all of the news and data coming from the US. An uptick in geopolitical problems in the Ukraine could also have the same effect.

(Photo courtesy of Tripp)

So Much for Steady US Gas Prices. Expect Spike Due to Iraq Oil Troubles

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Expect rising oil and gas prices due to continued unrest in Iraq
It’s amazing what a couple of weeks, and unrest in an oil producing part of the world, can do. At the beginning of the month, AAA predicted gasoline prices, while high, would remain fairly steady through the month, with a possible slight rise as we headed into the fourth of July weekend. In their words, “AAA predicts the national average price of gas this summer likely will vary from $3.55 – $3.70 per gallon.” They did add a caveat in the next sentence, and one which seems to be quite accurate with the current geopolitical situation in Iraq. The sentence they added was, “Major refinery disruptions, geopolitical concerns or a damaging hurricane season could send prices higher than forecast.”

A barrel of crude oil is now the highest it has been all year, and continued unrest and uncertainty in Iraq has it poised to go even higher. While the unrest hasn’t had an effect on Iraq’s oil production in the south thus far (attacks from insurgents in the north had already shut off experts from the northern oil fields), the higher prices continue to be driven by the fear Iraq’s oil exports in the south could take a hit later this year during peak world oil demand.

What does all this mean for those of us living in the US? Get ready to see a spike begin this week at gas stations and last as long as the unrest in Iraq keeps oil traders nervous. Record high gas prices have already hit England and parts of Canada in the last 24 hours, and while we may not hit record prices in the US, they are likely to be a lot more per gallon next week than they are this week. You can look for them to start heading toward $4 a gallon (the current average price for gas in the US is $3.66) as we approach July 4.

For many, that means going into gas saving mode to try and take some of the sting out of the higher prices. By far the best way to reduce the amount spent on gas is to use your car less. This isn’t always possible, but the less you can drive, the more you’ll save on gas. Below are five tips than can possibly help you reduce the amount you drive, and thus the amount you spend on gas:

  • Use alternative methods to get where you’re going if the distance isn’t too far away such as walking or biking.
  • Plan and combine trips so that you only go out once a day to get all your shopping and errands done, rather than several trips throughout the day.
  • Plan weekend activities closer to home rather than to places which require a long drive.
  • Consider carpooling, public transportation or ride sharing as an alternative to driving yourself to work each day.
  • Plan a summer staycation. Instead of taking a summer trip out of town, explore all the areas near you which you’ve wanted to see, but never have found the time to do so.If reducing the amount you drive isn’t possible, head to the least expensive gas station in your area and fill up. It’s almost guaranteed that the price will be a lot higher next week than it is today.