Stocks Slide as Oil Soars

FOX Business: The Power to Prosper

The markets shed early gains and turned sharply lower after geopolitical turmoil and oil prices hitting 2-1/2 year highs spooked traders.

Today's Markets

As of 3:24 p.m. ET, the Dow Jones Industrial Average lost 66.6 points, or 0.54%, to 12,343, the S&P 500 slipped 8.1 points, or 0.61%, to 1,325 and the Nasdaq Composite dipped 21.1 points, or 0.75%, to 2,775. The FOX 50 traded  lower by 5.2 points to 932.

Oil prices have soared to 30-month highs amid concern tumult in Libya and several Middle Eastern nations could restrict worldwide supplies of oil. Indeed, Libya's Sarir oil field -- the largest in the country -- was on fire Friday, igniting fears about the OPEC-member's ability to get its production back online.

Security forces clashed with protesters in Syria Friday, killing at least ten people, according to a report by Reuters, citing statistics from a hospital. Syria is a modest producer of oil, but is located in a strategically important location for the transportation of energy, according to the U.S. Energy Department. Fighting between protesters and the government in Yemen escalated as well, killing at least 25 and injuring 200 according to media reports.

Light, sweet crude recently jumped $2.49, or 2.3%, to $112.79 a barrel. Prices at the pump continue climbing higher as commodity prices have spiked.  A gallon of regular gas costs $3.74 on average nationwide, up from $3.52 last month and $2.86 last year, according to the AAA Fuel Gauge Report.

Oil generally trades inversely to the U.S. dollar, which sunk 0.66% against a basket of world currencies, putting further upward pressure on prices.

On the corporate front, Expedia (NASDAQ:EXPE) revealed plans to spinoff its TripAdvisor unit into a separate, publicly traded company, sending shares higher by as much as 15%. Google (NASDAQ:GOOG) also received permission from regulators to purchase ITA Software, which specializes in software for airlines.

The European Central Bank increased its key interest rates from a record low 1% to 1.25% on Thursday.  Many market participants see this as a sign the euro zone economy is able to recover without as much help from the government.

A key Federal Reserve official said Friday that while the U.S. economy is recovering, he doesn't see the Fed following the ECB's rate hike.

"With longer-term inflation expectations remaining stable -- and predicting that commodity price growth will stabilize -- my view is that current monetary policy is appropriate," said Dennis Lockhart, president of the Atlanta Federal Reserve Bank, in a speech.

Other Fed officials disagree, however.

"I see many risks of the Fed overstaying its welcome," said Richard Fisher, Dallas Federal Reserve Bank president. "No amount of further accommodation by the Fed would be wise."

Metal prices have increased substantially in recent sessions as well. Gold jumped $14.80, or 1%, to $1,474.

Corporate Movers

Hercules Offshore (NASDAQ:HERO) is the subject of an investigation by the Justice Department and Securities and Exchange Commission, causing the drilling company's stock to plummet.

Apple's (NADAQ:AAPL) iPad, iPhone and iPod Touch customers will be able to access live streaming content from Walt Disney's (NYSE:DIS) ESPN sports channel through an App.

NXP Semiconductor (NASDAQ:NXPI) is in talks with Intel (NASDAQ:INTC), Qualcomm (NASDAQ:QCOM) and Broadcom (NADAQ:BRCM) about a possible takeover, according to a report by Dutch paper De Telegraaf. The company specializes in making chips for payments made using mobile phones, an increasingly talked about technology.

Pfizer's (NYSE:PFE) Sutent drug was found to show uncertain benefit in treating pancreatic cancer, according to the Food and Drug Administration.

Foreign Markets

Global shares gained as optimism over recovery in the euro zone economy overshadowed lingering concerns over Portugal's need for a European Union-supported bailout.

The English FTSE 100 was up 0.81% to 6,056, the French CAC 40 climbed 0.83% to 4,062 and the German DAX jumped 0.53% to 7,217.

In Asia, the Japanese Nikkei 225 soared 1.9% to 6,768 and the Chinese Hang Seng traded higher by 0.47% to 23,396.