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U.S. crude oil futures ended near $65 to mark their highest level in two weeks on the back of stronger RBOB futures as mounting refinery glitches added to worries over gasoline supplies and refinery output.

The latest fuel to the gasoline rally was news that BP will shut a gasoline-making unit at its 460,000 barrels per day refinery in Texas City, Texas, on Friday for a planned 11-day turnaround.

Prices also rose as traders learned that Murphy Oil had shut a crude distillation unit at its 120,000 bpd refinery in Meraux, La., for maintenance. Murphy later said it would restart the CDU later Thursday after a brief shutdown for unplanned repairs.

“The gasoline market is on a boil because of the string of refinery issues,” said Jim Ritterbusch, president of Ritterbusch & Associates in Galena, Illinois.

June crude oil soared $2.31, or 3.7%, to $64.86 a barrel, trading from $62.48 to $64.90, which was the highest level since May 2.

NYMEX June RBOB gasoline finished 9.96 cents or 4.3% higher at $2.4366 a gallon, after hitting a session high of $2.44 just below the April 30 high of $2.455, which itself was the highest level since $2.4849 on May 12, 2006.

NYMEX June heating oil rose 6.97 cents or 3.7% at $1.9367 a gallon, trading $1.8708 to $1.94, which was the highest level since prices hit $1.9440 on Sept. 6, 2006.

Also, ConocoPhillips plans to shut the 67,000-bpd fluidic catalytic cracking unit at its 146,000-bpd Borger, Texas, refinery on Friday for a month-long overhaul, the company told state regulators.

The cat cracker is to be shut through June 23, according to the notice filed. A CO boiler will also be shut for work at the refinery from Friday to Monday.

The restart on Wednesday of Valero Energy’s 130,000 bpd Houston refinery failed and that would cut gasoline production at the plant by 64,000 bpd for about a week.

Traders said some units at ConocoPhillips’ Sweeny, Texas, refinery were running at reduced rates.

The multiplying refinery troubles have gained more focus in the past two sessions, overriding Wednesday’s government data that showed gasoline stocks rose 1.7 million barrels last week,mainly as the result of a large inflow of imports.

Gasoline stocks have risen 2.1 million barrels in two weeks.

Before that, stocks had declined for 12 straight weeks, slashing inventories by 34.1 million barrels, or 15%, from the early February storage.

The stock market lost its footing this week, and Goldilocks seemed to fall into a ditch.

After more than seven months of rallying, the U.S. stock market experienced a panic-ridden day — Tuesday — not seen since the immediate aftermath of the Sept. 11, 2001, terrorist attacks. The three major indices had their worst week since March 2003.

The main culprit? China’s stock market. Its near-130% surge last year was one of the prime examples of investors ramping up leverage to take on more risk.

Investors awakened Tuesday to an 8.8% plunge in China’s Shanghai Composite index, and the selling began. Margin calls kicked in and begat more selling. As the week progressed, the vehicles that offered investors the opportunity for those leveraged bets, such as the Japanese yen carry trade (borrowing yen at a paltry 0.5% and investing in higher-yielding assets elsewhere), unwound as volatility increased.

After choppy sessions following Tuesday’s rout, the Dow Jones Industrial Average closed down 4.2% for the week, 1% on Friday alone, to 12,114.10. The S&P 500 slid 4.4% on the week and 1.1% Friday, and the Nasdaq Composite fell 5.8% this week and 1.5% Friday, closing at 2368.00.

The price of crude oil jumped 1.2% this week to $61.64 per barrel, while gold slid 6.4% to $644.10 per ounce. The Treasury bond market rallied sharply as investors took the “flight to safety” route. The yield on the 10-year note fell to 4.51% Friday from 4.68% last week. The value of the yen rose 4% vs. the dollar.

In overseas markets, the Shanghai Composite recaptured some of its losses, sliding just 6.8% on the week. Japan’s Nikkei 225 slid 5.3%. The weakness overseas wasn’t limited to Asia. The broad MSCI Emerging Markets Index fell 8.1% for the week.

Within the U.S., stock market declines were broad-based even as some investors started to look for bargains. Traders mentioned dipping into housing stocks and even some of the subprime mortgage lenders, hoping the worst was over. But given that the indices ended Friday’s trading session at the day’s lows, hopes for a stock market bottom were dim.

“Never on a Friday,” says Jeffrey Saut, chief equities strategist at Raymond James & Co. “Markets never bottom on a Friday after a week like this. Participants go home and brood about it.” Saut believes there may be a “tradeable low” on Monday or Tuesday, but that would just lead to a three-to-five-day “throwback rally.”

Overall, “the consternation isn’t over,” he says. “The market had a heart attack, and a heart attack patient doesn’t get right off the gurney and run the 100-yard dash. The market shouldn’t either.”

Only two Dow stocks were in the green Friday as declines of more than 2% each in General Motors (GM) , Citigroup (C) and JPMorgan Chase (JPM) led the index south. Merck (MRK) was up a fraction, and American International Group (AIG) jumped more than 3% on a strong earnings report.

The financial sector and banks were particularly weak, as those companies struggled amid subprime meltdown woes and recession fears. After seeming nearly unbreakable for several months, the mighty were falling. Goldman Sachs (GS) lost 9.6%. Merrill Lynch (MER) , Bank of America (BAC) and JPMorgan Chase fell 7.7%, 5.4% and 5.6%, respectively.

The bottom was decidedly not in for the subprime mortgage lenders either. Shares of Countrywide Financial (CFC) , New Century Financial (NEW) and Accredited Home Lenders (LEND) slid more than 4% each on the week.

Investors looked to economic data to inspire a bounce or fuel more selling. They found germs of worry in several reports and in some of the rhetoric that swirled through Wall Street’s corridors.

Ex-Federal Reserve Chairman Alan Greenspan agitated by mentioning the possibility of a recession. Then current Fed Chairman Ben Bernanke soothed by saying that after he watched the recent data, there was no material change to his economic outlook.

The data were mixed.

On the strong side, personal income and spending rose higher than expected, and the Institute for Supply Management’s manufacturing index jumped to a 52.3 reading vs. expectations for a flat 50 reading.

But manufacturing and business spending looked exceptionally weak, with a dismal decline of 7.8% in durable goods orders. The Commerce Department also revised fourth-quarter GDP to 2.2% from initial estimates of 3.5%. One of the biggest downward revisions was to business investment spending. The Chicago PMI report, which chronicles manufacturing activity in the Midwest, was weak at 47.5 — a reading that indicates contraction in the economy.

Perhaps the most disturbing piece of data was the initial jobless claims, which came in higher than expected for the third consecutive week. The four-week moving averages of initial and continuing claims rose to their highest levels since after Hurricane Katrina, in August 2005.

“The longer the uptrend continues, the more likely the move is significant,” wrote Joe Lavorgna, chief economist at Deutsche Bank. Lavorgna revised his forecast for payrolls down to 75,000 from the consensus 100,000 estimate.

Indeed, all eyes will be on the payrolls report next week. If unemployment starts to rise, the Fed gets back in the game with a possible rate cut. That may be something traders think they want after such a panic-stricken week, but it surely would accompany a shift to a much weaker economy, which does not actually bode well for profits or stocks in the near term.

1 What would best describe your stance heading into the coming week of trading?

Bullish
Bearish
Neutral

2 Which of these sectors do you think is set to move up in the coming week?

3 Which of these sectors do you think is set to move down in the coming week?

PRESIDENT George Bush yesterday offered his condolences to the victims of violent storms that swept across the southern United States as the death toll rose to at least 20.

Mr Bush was due to visit the affected areas today and said he would do his “very best” to comfort people whose lives had been “turned upside down by the tornadoes”.

A hospital in Georgia and a secondary school in Alabama - where pupils were trying to shelter - were torn apart by ferocious winds.

The death toll could increase, with the US coastguard warning that six people were still missing after their 23ft vessel began taking on water off South Carolina on Thursday night.

The tornadoes, which levelled scores of homes while flipping cars into the air and leaving thousands stranded without power, killed nine people in Georgia and 10 people in two southern Alabama towns. They were also blamed for the death of a young girl in a mobile home in Missouri.

The height of the tornado season in the US does not begin until May, but winter tornadoes are common in years which experience the El Nino phenomenon - the warming of Pacific waters brings torrential rain to some parts of the globe and drought to others.

Mr Bush said he would visit the stricken areas “with a heavy heart.”

“I go down knowing full well that I’ll be seeing people whose lives were turned upside down by the tornadoes. I’ll do my very best to comfort them,” he said.

The Bush administration’s initial response to Hurricane Katrina, the most destructive natural disaster in US history, was widely seen as a failure and it has been keen to play a more active role in natural disasters since then.

In Georgia, two died in the town of Americus when the Sumter Regional Hospital was hit by a tornado, and six died, including two children, in hard-hit Baker County. The ninth fatality was in Taylor County, to the north of Americus. “I was shocked. It was worse than I had feared,” Sonny Perdue, Georgia’s governor, said after he had toured areas hit by the storms. “It’s just a blessing that we didn’t have more fatalities.”

Tara Emnett, an official at the mayor’s office in Enterprise, Alabama, said all but one of the nine victims there were pupils at the high school, a shredded building left surrounded by broken trees and overturned cars.

The high school’s pupils had been assembled in hallways when the storm hit, in line with emergency procedures as this is generally the most structurally sound part of the building.

However the children said the hallway’s roof caved in soon after they gathered there.

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Indexes managed to stave off all but minor losses as oil prices rose.

The NYSE ended down less than 0.1%. The Nasdaq closed flat. The S&P 500 lost 0.1%. The Dow slipped 0.2%. Preliminary figures show volume off near 30% on both the NYSE and the Nasdaq.

A lower close on lower volume meant the rally followed up Friday’s strong gains with mild losses.

The tool makers’ industry group registered the largest gain, after an analyst upgrade boosted shares of Actuant () 4%. Shares of Apple () rose 4.59 to 125.09, hoisting computer manufacturers to the day’s second-best gain. Tire makers, burned by connection to wobbling transportation stocks, logged the day’s biggest losses.

Losers ran just slightly ahead of gainers on both the NYSE and the Nasdaq. Leaders tended to turn up on the wining side of that equation.

Cal-Maine Foods () jumped 0.83 to 16.53. The company produces and distributes eggs to grocery stores and food products makers. In a two-day spike, the stock blew shares past a 14.10 buy point on 16-week cup-with-handle base. Shares are now 11% above that buy point.

Cascade () rocketed 3.07 to 84.32. It is the stock’s seventh day of heavy-volume gains since reporting its Q1 EPS beat views. Shares broke above a 66.30 buy point on a six-week flat base May 29. They are now extended 27%

New Oriental Education & Technologies () spiked up 3.30 to 51.69. The 7% spike hoisted the stock above a 50.30 buy point on a pullback to the 10-week moving average. The China-based language training provider’s shares broke out of a seven week cup-shaped base in April. They are now 3% above the pullback buy point.

On the downside, Cephalon () reversed lower, losing 1.22 to 82.64. A pill maker for treating sleep disorders, cancer and chronic pain, its stock has been wedging up, flirting with three weeks tight patterns, but on below average volume, since April. It broke out of an 18-week double-bottom base April 27. It is now 17% above the base’s 70.75 buy point.

2:30 p.m. ET update: Stocks Trading Nearly Flat As Volume Drills Lower

By ALAN R. ELLIOT

Stocks held their ground into late afternoon as volume dipped sharply.

Bond yields drifted higher. Crude oil prices climbed. The number of industry groups gaining 1% or more advanced from nine to 13. Groups losing more than 1% held steady at four. The Electronic-Military Systems industry group jumped 1.5% after an analyst upgraded Argon ST ().

The NYSE and Nasdaq composites were both down less than 0.1%, the Nasdaq up just 0.1% at 2:14 p.m. ET. The Nasdaq’s transportation and biotechnology indexes were under fire, down 1.2% and 0.8% respectively. The Dow and S&P 500 were both down 0.1%. Volume was tracking 28% lower on NYSE, down 30% on Nasdaq.

Crude oil prices reversed from an early slip, gaining 0.82 to 68.82 after two attacks on oil production sites in Nigeria. About 700,000 barrels a day of production is currently shut down in the country. A pending workers’ strike is compounded concerns for additional tightening in output of Nigeria’s light, sweet crude.

A broad swath of stocks continued to register gains.

China Mobile () gapped up, adding 1.88 to 51.25 after news reports that the company was continuing to pursue an A-share initial public offering on the Shanghai Exchange. Monday’s 4% move raised shares to within 1% of the 51.88 buy point on a 17-week cup-shaped base.

Western Refining () jumped 2.64 to 55.34. The move followed the Federal Trade Commission’s announcement Friday that it would move to dismiss its attempt to block the refining company’s takeover of Giant Industries. The 5% jump boosted the 18-month-old stock to new highs. Shares were 33% above a 41.49 buy point on a May pullback to the 10-week moving average.

Fertilizer maker Terra Nitrogen () gained 3.38 to 114.88. It is the stock’s third straight day of heavy volume gains on a breakout above a 100.08 buy point from a 10-week pullback. It is now 15% above that buy point.

Cadence Systems () gapped down, dropping 1.01 to 22.29. The 4% drop returned the maker of automated circuit design tools below its 10-week moving average line.

Veolia Environnement () lost 0.97 to 78.08, continuing its eight-day topple below its 50-day moving average line. The stock broke out of an 11-week cup-shaped base April 3. Monday’s move left shares 3% above a 75.97 buy point.

1 p.m. ET update: Indexes Higher In Midday Trading

By IBD STAFF

The main indexes were moderately higher in midday trading, reacting to movements in Treasury yields.

At 1:15 p.m. ET, the Nasdaq, S&P 500 and NYSE composite were all up 0.1%. The Dow was flat.

Volume remained sharply lower after Friday’s quadruple witching session.

Technology, chemicals and some consumer-related industry groups led the day’s action. Air freight and other transportation-related groups were weaker.

Aircastle () rose 0.92 to 39.72, making a new high.

11 a.m. ET update: Stocks And Volume Head Lower After Early Spike

By ALAN R. ELLIOTT

Stocks quickly gave up early gains and headed lower as bond yields edged higher and earnings reports provided little lift. Volume turned down sharply vs. Friday’s heavy, options expiration-driven trading.

The Nasdaq composite was down 0.1%, while the NYSE composite was off less than 0.1% at 10:56 a.m. ET. The Nasdaq’s transportation and biotechnology indexes led the downturn. The S&P 500 and Dow were both down 0.1%.

Foreign exchanges showed mixed results. The Shanghai Composite gained 2.9%. The Nikkei 225 in Tokyo added 1.0% and London’s FTSE 100 slipped 0.3%.

News reports said that Australia-based mining and metals giant BHP Billiton () was discussing a possible takeover of Alcoa (). Alcoa offered $28.4 billion for Canada-based competitor Alcan Inc., but Alcan rejected the bid.

Ten-year bond yields edged up slightly, to 5.19%. Investors were also digesting news from debt rating agency Moody’s, which on Friday announced ratings cuts on 131 bonds with strong ties to speculative subprime loans. The agency said it was reviewing ratings on an additional 247 bonds.

Crude oil for July delivery dipped 32 cents to $67.68 a barrel.

Losers ran slightly ahead of gainers, but several fundamentally sound stocks continued to log gains.

China Medical Technologies () gapped up, adding 4.30 to 31.55 after reporting its fiscal Q4 earnings rose 21%. Consensus views called for a flat quarter. Revenue rose 46%. On Friday, the stock broke above the 27.26 left side buy point on a cup-shaped base begun in February. Monday’s jump left shares 16% above that buy point.

Piping systems maker Synalloy () popped up 1.81 to 46.41. The move left shares 7% above the 43.53 buy point on a pullback to the 10-week moving average line. It’s the stock’s third pullback since a breakout from a flat base in February.

MasterCard () rose 3.41 to 161.06. The gain hoisted shares to 5% above the 153.41 buy point on a pullback to the 10-week moving average. The credit card provider’s stock broke out of a 10-week cup-with-handle base in April.

On the downside, shares of book retailer Books A Million () dropped 3.07, or 15%, to 17.03. The slip thwarted the stock’s bid to fashion the right side of an awkward, cup-shaped base. It sent shares below their 10-week moving average for the first time since April, and left them 28% below their December high.

Updated from 2:03 p.m. EST

Energy prices were higher on Thursday after new inventory numbers for crude oil and natural gas were released by the Energy Information Agency.

Light, sweet crude oil for April delivery finished up 88 cents at $60.95 a barrel. Natural gas closed 1.1% higher at $7.72 per million British thermal units.

Heating oil finished the day 4 cents higher at $1.73 per gallon, and gasoline advanced 3 cents to $1.75 per gallon.

The EIA inventory figures were more bullish than analysts had anticipated. Crude inventories were expected to increase by 700,000 barrels during the week ended Feb. 16, but they actually fell by 416,000 barrels.

Analysts were expecting a draw from distillate inventories of 2.8 million barrels, while 5 million barrels of crude distillates were actually withdrawn from storage.

The energy market was also being affected by refinery fires and gas pipeline leaks in the U.S. and tension surrounding a possible United Nations reaction to Iran’s nuclear enrichment program.

The deadline has passed for Tehran to end its atomic development or risk sanctions, and now the International Atomic Energy Agency says Iran is actually expanding rather than halting its plans.

Joe Palmisano, technical analyst at IDEAGlobal in New York, says that he expects the price of crude oil to trade choppily over the next few days and stay within the $57.50 to $61 range.

“The period from late February through March is a lull period for energy markets,” Palmisano says. “I don’t see any impetus for breaking out of recent ranges. It won’t be until April or May that we’ll see more action in the markets.”

Energy stocks mostly advanced from their closing positions Wednesday. However, the iPath Goldman Sachs Crude Oil (OIL) was 10 cents lower at $36.50.

Ferris Baker Watts upgraded the stock of oil and gas independent Ram Energy Resources (RAME) from neutral to buy and increased the company’s price target to $6. Ram Energy’s stock was up 4.5% at $4.52.

Oil majors Exxon Mobil (XOM) , Royal Dutch Shell (RDS.A) and ConocoPhillips (COP) finished the day fractionally stronger.