Technology stocks rally in the US on the back of falling oil prices

By MoneyhighStreet Staff. Published on May 28, 2008 This post currently has no comments.

Apple
Falling oil prices helped US tech companies enjoy rises on their stock markets yesterday (May 27th).

During the day, crude prices dropped around three per cent and closed in New York at $127.32.

Rueters reported that, on the back of the falls, technology companies rallied, with Apple and Google leading the way - both saw their share value rise by around three per cent.

By the close of trading, Apple was trading at $186.43, while Google reached $560.90.

Peter Jankovskis, director of research at OakBrook Investments, explained to Rueters that there had been fears that rising oil prices would dent consumer spending - especially on disposables such as technology.

"Oil being down helps because people lately seem to be thinking of technology (spending) as discretionary," he told the news agency.

"I really think what we''re doing is building a very solid base for a strong rally to end the year."

The AFP has reported that oil prices slipped further overnight. It said that the falls were the results of fears that the US economy could enter a recession and reduce demand for the product.

"Traders are picking profits after a very strong rally last week over a number of bearish factors and therefore making a correction," Victor Shum, an analyst at Purvin and Gertz energy consultancy, told the agency.