MoreAfter setting a new all-time record settlement price of $48.88 on Friday, oil continued its march higher on Monday, creating new worries on Wall Street that the slowdown in profits and the economic recovery would extend through the end of the year due to high energy costs.
A barrel of light crude for November delivery was quoted at $49.40, up 52 cents, on the New York Mercantile Exchange. Prices reached $49.74 earlier in the session, marking the highest intraday trading level ever recorded.
"Clearly we've had oil putting a lot of pressure on this market over the past week or so, but given where oil is right now, we would've expected the market to react even more negatively than where it is," said Brian Belski, market strategist at Piper Jaffray. "With productivity and earnings still pretty strong, and inflation tame aside from oil and gas, we think the market still is set up for a positive move in the fourth quarter."
Oil producers and refiners still struggled to recover from Hurricane Ivan's damage in the Gulf of Mexico, and global demand continues to tighten, analysts said, making the markets susceptible to even minimal losses in overall production.
The Commerce Department reported that new home sales rose 9.4 percent to 1.184 million units in August, a higher figure than economists had forecast. While overshadowed by oil, the goood news showed that consumers were still willing to make big purchases even as the economy has slowed.
