US stocks slid yesterday as surging oil and gold prices stoked investor fears about inflation risks and overshadowed optimism about corporate profits.
Oil hit $70 for the first time since Hurricane Katrina as worries increased about oil producer Iran's nuclear standoff with the West, and front-month contract prices settled above that level for the first time since the Nymex launched crude oil futures trading in 1983.
Airlines ranked among the sectors that took a beating from higher oil prices.
Commodity gains deflected some attention away from earnings just as the quarterly reporting period gets under way.
Shares of Citigroup, the world's largest financial services company by market value, rose after the company reported first-quarter profit that beat analysts' expectations.
"People are really fearful of $3 gas going into the summer. That's a big nervous point for your average consumer . . . and I certainly think these prices will be factored into the next earnings cycle," said John O'Brien, head of sales trading at KeyBanc Capital.
The Dow Jones industrial average was down 63.87 points, or 0.57 per cent, at 11,073.78. The Standard & Poor's 500 Index was down 3.79 points, or 0.29 per cent, at 1,285.33. The Nasdaq Composite Index was down 14.95 points, or 0.64 per cent, at 2,311.16.
At one point, the Nasdaq declined 1 per cent and briefly dipped below the key pscyhological level of 2,300 for the first time in almost three weeks.
Shares of JetBlue Airways dropped 9 per cent, or 93 cents, to $9.47 on the Nasdaq, while Continental Airlines stock fell 10.8 per cent, or $2.95, to $24.42 on the New York Stock Exchange, leading a decline in airline stocks on concern about oil prices.
Gold futures also soared, with the benchmark Comex June gold contract hitting a new 25-year high. Shares of Newmont Mining Corp. climbed 6 per cent, or $3.20, to $56.07 on the Nyse.
Industrial conglomerates General Electric and 3M helped pull the S&P 500 lower, with GE exerting the heaviest pull on the index. GE shares fell 1.8 per cent, or 60 cents, to $33.29, while shares of 3M shed 0.9 per cent, or 71 cents, to $80.26.
US crude oil for May delivery settled at $70.40 a barrel, up $1.08.
