Stocks headed lower as oil rises to $100 a barrel

Feb 24 2011 - 8:49am

NEW YORK -- Stocks are headed lower and oil is rising above $100 a barrel as the violence in Libya intensifies.

Army units loyal to Libyan leader Moammar Gadhafi struck back at protesters in Libya's capital, Tripoli, and attacked a mosque outside of the city where many anti-government demonstrators had taken refuge. Rebels continued to take control of much of the eastern part of the country, effectively splitting Libya into two.

The clashes sent oil up 3.4 percent to $101.27 a barrel Thursday. Libya is the world's 15th largest exporter of crude, accounting for 2 percent of global daily output. Traders are worried the revolt could threaten Libya's oil production and spread to other countries in the region, such as oil-rich Saudi Arabia.

Ahead of the opening, Dow Jones industrial futures are down 37, or 0.3 percent, at 12,058.

Standard & Poor's 500 futures are down 7, or 0.6 percent, at 1,298. Nasdaq 100 index futures are down 10, or 0.4 percent, at 2,294.

Bond prices are rising, pushing their yields lower. The yield on the 10-year Treasury note fell to 3.44 percent from 3.49 percent late Wednesday.

General Motors Corp. rose 1 percent in pre-market trading after it reported its first annual profit since 2004. The company has benefited from strong sales in China and the U.S. as the global auto market has recovered.

Kohl's Corp. fell 1 percent ahead of the opening after the department store operator issued an earnings forecast for 2011 that was below analysts' expectations.

Target Corp. also fell about 1 percent even as the retailer said its fourth-quarter profit rose by 10 percent as a result of an improving credit card business and solid holiday sales.

Economic news was mixed. The Labor Department said fewer people applied for unemployment benefits last week, the third drop in the past four weeks. But orders for long-lasting manufactured goods outside of transportation fell by the largest amount in two years in January. That raised concerns about the health of the manufacturing industry.

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