Wall Street gains as oil continues price moderation

15 August 2008

Stocks advanced yesterday, with lower oil prices cancelling out the bad news on consumer inflation.

The Dow Jones industrials put on 0.7 per cent, while the broader Standard & Poor's 500 added 0.6 per cent.

A sharper rise was measured on the Nasdaq composite, which closed one per cent up yesterday.

Higher-than-expected US inflation figures released earlier in the week had hit the exchanges hard on Tuesday and Wednesday.

However, a further decline in oil prices - which have now dropped by 22 per cent from this year's all-time high of $147 per barrel - fuelled yesterday's rally.

Crude futures fell a further 99 cents by close of play, to reach $115.01.

"I guess the perception is that the inflation report is backwards looking, and with the correction in commodities we've seen recently, the next report will show improvement," Michael Church, senior portfolio manager at Church Capital, told CNNMoney.

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