Stocks Soar, So Does Oil

While the NASDAQ spent most of the day in the red, the Dow maintained a positive posture throughout the session, then sprinted to the finish, with the major indices closing at their highs of the day for the second session in a row.

There was little in the way of news except from the oil fields, where an unexpected drop in US gasoline supply sent oil rocketing upwards nearly $5 per barrel.

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With the focus on oil prices and the financial sector, earnings from Hess Corporation (HES) set the tone with a 62% rise in 2nd quarter profits from a year ago. The gains were attributed mostly to the extraordinary hike in the price of oil and gas and investors piled into the equity, boosting shares by more than 13% (106.97, +12.72).

With roughly 350 companies disclosing earnings, it was difficult to keep track of winners and losers, though most of those reporting early in the day were uninspiring.

On the whole, investors seemed relieved that there was no more discouraging news on housing or credit with which to weigh their fears, and the last hour of trading was spent pushing stocks higher, though without any real impetus.

Dow 11,583.69 +186.13; NASDAQ 2,329.72 +10.10; S&P 500 1,284.26 +21.07; NYSE Composite 8,565.31 +146.11

Advancers led declines, 3840-2397, and new lows remained ahead of new highs, 220-119.

Volume was moderate.

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Crude oil for September delivery closed up $4.58, at $126.77, though the metals continued their recent decline. Gold lost $14.10, closing at $910.30, while silver fell 9 cents to $17.47. The continuing decline in the precious metals is presaging a recession of magnificent proportions.

While the Fed and central bankers work to keep the latches on the credit windows from becoming completely detached, money is flowing out of nearly everything, from real estate to metals to stocks. Recent gains on Wall Street have been fleeting, as there has been no resolution to ongoing credit problems or the implosion of the US banking system.

Things are so broken, every day seems to bring forth a new financial device or instrument to stem the tide of defaults and capital erosion. Sadly, there is little anyone can do at this point. The damage has been wrought and a cataclysmic event could occur at any time, though the Fed and government officials - hell-bent on re-election in November - seem to prefer a slow, but steady Chinese torture approach to the unwinding of the financial system.

Drip, drip, drip....

NYSE Volume 1,472,582,000
NASDAQ Volume 2,270,902,000