Dow Jones: Stock Market and Oil

dow jones: But there's a good chance that, once investors digest the price hike and the doom-and-gloom predictions that it would be a game changer, the stock market will resume its uptrend, according to Market Watch. That's because many investors are interpreting recent events through the lens of years ago, when a higher oil price was indeed a bearish omen for the equity markets. To be sure, the Dow Jones Industrial Average DJIA, 0.13% responded to this past weekend's attacks on Saudi oil fields with a triple-digit decline on Monday. But over the last decade, the relationship between oil CLV19, 0.21% and the stock market has been just the reverse. If the two rose and fell in perfect lockstep, of course, that coefficient would be plus 1.0 and minus 1.0 if stocks always rose when oil fell, and vice versa. This shift is clear in the accompanying chart, which plots the correlation coefficient for the trailing 60-month relationship between stocks and crude oil. (news.financializer.com). As reported in the news.