Shares fall and oil prices rise in wake of superstorm Sandy
WALL Street began trading on Wednesday after monster storm Sandy forced a two-day closure, with shares trading lower and crude oil rising even though most refineries emerged unscathed.
U.S. lumber futures soared on expectations for increased demand, while gains in crude oil futures were capped by concerns about the impact from Sandy on demand in the world's largest oil consumer.
The storm left swaths of the East Coast crippled by flooding and power outages, suggesting lower fuel consumption.
The region's biggest refinery, in Philadelphia, and several others were ramping up operations after escaping damage.
But the storm, which killed at least 45 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 11.63 points, or 0.09pc, at 13,095.58. The Standard & Poor's 500 Index was down 2.20 points, or 0.16pc, at 1,409.74. The Nasdaq Composite Index was unchanged.
MSCI's all-country world equity index was unchanged at 329.12, on track for its first monthly loss since May. The index has gained more than 10pc so far this year.
Crude oil gained, with Brent crude rising above $109 a barrel. Brent for December delivery was up 4 cents at $109.12. U.S. light sweet crude oil rose 53 cents to $86.21 a barrel.
Bond prices rose. The benchmark 10-year U.S. Treasury note was up 1/32 in price to yield 1.7067 percent.
The euro rose against the dollar and was headed for its third straight month of gains.
The yen, which also tends to rise in times of turmoil and fall when market sentiment improves, weakened across the board.
The euro rose 0.07pc against the dollar to $1.2964.