Stocks Fall on Record Oil Prices

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Stocks shed early gains on Wednesday after oil prices hit another record high and government data gave investors conflicting views on the economy.


The Dow Jones Industrial Average fell 84.71, or 0.8 percent, to 10,434.87. The Standard & Poor’s 500 Index lost 8, or 0.7 percent, to 1,209.59. The Nasdaq Composite Index dropped 8.34, or 0.4 percent, to 2,128.91.


Surging crude prices erased gains that followed the Energy Department’s inventory report, which showed a strong buildup of heating oil and distillate stocks, but a drop in gasoline inventories. And worries that a storm in the Atlantic could damage oil production platforms sent crude futures to a new record. A barrel of light crude rose $1.61 to settle at $67.32 on the New York Mercantile Exchange, surpassing the previous record settlement of $66.86 per barrel on Aug. 12.


Shares of U.S. homebuilders advanced after the Commerce Department said new-home sales in July soared to a seasonally adjusted annual rate of 1.41 million units, a 6.5 percent increase from June’s pace of 1.32 million units, which had been the previous record. The new data contrasted with a report Tuesday that showed fewer purchases of previously owned homes. Local companies KB Home rose 1.8 percent to $72.20 and Ryland Group Inc. edged up 1 percent to $71.48.


Shares of a number of casual-dining companies fell after Overland Park, Kan.-based Applebee’s International Inc. cut its full-year profit forecast due to weak sales in the Midwest and New England. L.A.-based Grill Concepts Inc., which operates Pizzeria Uno and Daily Grill restaurants, slid 5.3 percent to $3.20 on the news. California Pizza Kitchen Inc. lost 3.5 percent to $31.59 after its stock rating was downgraded to “strong sell” from “sell” by analyst Ivan Feinseth at Matrix USA.


Other local movers included Keystone Automotive Industries Inc., whose shares rose 8.5 percent to $31.90 after the stock rating of the Pomona-based maker of vehicle body parts and bumpers was raised to “buy” from “hold” by BB & T; Capital Markets analyst Anthony Cristello.


And j2 Global Communications Inc. added 5.8 percent to $39.44 after the L.A.-based provider of messaging services’ stock rating was raised to “overweight” from “equalweight” by Pacific Growth Equities analyst Joseph Noel. Noel said the company may report strong third-quarter earnings.

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