US stocks recover losses in afternoon trading, price of oil gains on Yemen conflict


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NEW YORK — U.S. stocks were little changed in afternoon trading Thursday, having recovered their losses from earlier in the day. Investors continued to watch the Middle East, where Saudi Arabia has launched strikes on key military installations in Yemen. The price of oil rose.

Despite the tension in the Middle East and the plane crash in Europe, investors were generally not moving into their traditional havens of safety. Bond prices fell, gold prices were up only slightly and dividend-paying stocks were lower.

KEEPING SCORE: The Dow Jones industrial average was essentially unchanged at 17,720 as of 2:16 p.m. Eastern time. It was down 139 points earlier. The Standard & Poor's 500 index was up a point at 2,062 and the Nasdaq composite was flat at 4,875.

ENERGY: Oil prices jumped as concerns of spreading turmoil in the Middle East after Saudi Arabia bombed key military installations in Yemen. Benchmark U.S. crude rose $1.95 to $51.15 a barrel on the New York Mercantile Exchange. Brent crude, a benchmark for international oils, rose $2.57 to $59.05 a barrel in London.

YEMENI WORRIES: In Yemen, Saudi Arabia launched air strikes, along with others, in an effort to oust Shiite rebels that forced the country's embattled president to flee. Some of the strikes hit positions in the country's capital, Sanaa, and flattened a number of homes near the international airport.

Yemen, which is located on the Arabian peninsula southwest of Saudi Arabia, plays a crucial geographic role in the world's oil supply. All oil tankers going through the Suez Canal must navigate around Yemen, which makes any turmoil there particularly troublesome for the oil market.

ANALYST TAKE: "The conflict has the potential to act as a drag on oil supplies as most oil tankers from Arab producers must pass by the Yemen coastline in order to get through the Red Sea and Suez Canal," said Craig Erlam, senior market analyst at OANDA.

EUROPE: Germany's DAX slipped 0.2 percent, France's CAC 40 fell 0.3 percent and Britain's FTSE 100 lost 1.4 percent.

SANDISK SLUMP: SanDisk dropped 18 percent, the most in the S&P 500, after the maker of flash memory chips cut its revenue forecast. The company said sales of some of its products were weaker than expected and prices were falling. SanDisk lost $14.82 to $66.35.

CURRENCIES: The euro fell to $1.0879 and the dollar declined to 119.27 Japanese yen. The dollar's appreciation this year has been a dominant concern for many investors. A stronger dollar makes U.S.-made goods more expensive abroad, which makes it more difficult for U.S. companies to compete.

"The dollar is going to be a drag on company earnings, at least temporarily," said Stephen Freedman, a strategist at UBS Wealth Management Research.

BONDS: U.S. government bond prices fell. The yield on the 10-year Treasury note rose to 1.99 percent from 1.93 percent the day before.

METALS: Gold rose $7.80 to $1,204.80 an ounce, silver rose 14 cents to $17.14 an ounce and copper rose two cents to $2.81 a pound.

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