Shares fall, oil rises in wake of Sandy

NEW YORK: Wall Street resumed trading yesterday with shares moving lower after monster storm Sandy forced a two-day closure due to weather for the first time since 1888, but US gasoline futures surged in the face of potentially long-term supply disruptions at the East Coast’s second-largest refinery.
The storm left swaths of the region crippled by flooding and power outages, suggesting lower fuel consumption. But gasoline futures for November hit their highest level in more than two weeks as traders scrambled to cover positions ahead of the contract’s expiry.
US lumber futures soared on expectations for increased demand amid concerns that a Phillips 66 refinery in Linden, New Jersey, could shut for an extended period after Sandy cut power to the plant that produces 238,000 barrels a day of fuel.
The storm, which killed at least 50 people, may cause up to $ 15 billion in insured losses, according to one disaster-modeling company. Traders said speculators were behind much of the buying in lumber futures as they anticipated demand to rise.
Contracts for November, January and March lumber futures on the Chicago Mercantile Exchange rose by the daily trading limit of $ 10 per thousand board feet and remained locked at those levels, effectively shutting down trading.
Markets were expected to be volatile, with light volume as many traders remained unable to get to their offices or work from home because of power outages and no or limited public transit across the region.
“Liquidity remains very light in equities as there are a lot of empty seats on the Street,” said Dave Lutz, a Baltimore-based trader with Stifel, Nicolaus & Co.
“We’re also seeing some outsized moves.”
The Dow Jones industrial average was down 35.19 points, or 0.27 percent, at 13,072.02. The Standard & Poor’s 500 Index was down 3.56 points, or 0.25 percent, at 1,408.38.
The Nasdaq Composite Index was down 0.66 percent, or 19.62 points, at 2,968.33.
MSCI’s all-country world equity index was down 0.12 percent at 328.71, on track for its first monthly loss since May. The index has gained more than 10 percent so far this year.
In Europe, stocks dipped after a mixed batch of corporate earnings, pressured by heavyweight British oil and gas firm BG Group, which warned of no production growth next year.
The FTSEurofirst 300 closed down a provisional 0.5 percent at 1,097.54. BG slumped 13.7 percent to 1,147.5 pence, the biggest loser on Britain’s blue-chip FTSE 100 index.
Crude oil gained, with Brent crude rising above $ 109 a barrel. Brent for December delivery was up 2 cents at $ 109.10. US light sweet crude oil rose 68 cents to$86.36 a barrel.
Bond prices rose. The benchmark 10-year US Treasury note was up 5/32 in price to yield 1.70 percent.
The euro edged up against the dollar and headed toward its third straight month of gains, but uncertainty about the heavily indebted euro-zone economies was set to limit further strength.
The euro rose 0.07 percent against the dollar to $ 1.2965.