Stock Market Struggles Through Rising Oil and Gas Prices
HEIDI COLLINS, CNN ANCHOR: You are in the CNN NEWSROOM. Good morning, everybody. I'm Heidi Collins. Tony has the day off. See events come into the NEWSROOM live this Monday, June 30. Here's what's on the rundown. Oil and gas prices crossing into record territory today. Stocks flirting with the bear. Trading 30 minutes away. President Bush signs a new war funding bill live this hour. Plus, the army critiques its tactics after the Iraq invasion. And baby with a warranty. Doctors guarantee a girl won't get hereditary breast cancer. Gene play, in the NEWSROOM. Taking a look at Iraq today. Special reports from the war zone as we get ready for President Bush to sign that new war funding bill. We're going to bring you that live this hour. But our top story today, "ISSUE #1," the economy. The opening bell just 30 minutes away, and after last week's beating, how will the markets react today? Our Susan Lisovicz is just seconds away with an update, plus senior business correspondent Ali Velshi is live in New York right now. He'll be looking at the effects of rising oil prices. As you know investors are bracing for another rocky day on Wall Street. Susan Lisovicz at the New York Stock Exchange with a look at what to expect. Susan, Thumbs up? Thumbs down?</s>SUSAN LISOVICZ, CNN CORRESPONDENT: Down, unfortunately. And you know that's something we've seen a lot in this month of June. This is the final trading day of June. Investors will be happy to close the book on the month. The Dow lost 10 percent, or about 1300 points, and we are expecting another weak open. Not anything severe, but indicative of the negative sentiment that is so rampant here. On Friday the Blue Chips crossed into bear market territory, a 20 percent drop from its recent high. It closed just 15 points above that level Friday. Expect a volatile session from something known as portfolio dressing --traders adjusting ahead of quarterly reports. Record high oil prices continue to pressure stocks. Ali, of course, will have more on that in just a minute. Investors are concerned how that will rein in consumer spending and corporate profits in an economy already battered by the housing crisis and credit crunch. Just one economic report today in about 45 minutes on manufacturing. The major news comes out Thursday. The monthly employment report, another decline in jobs is expected. The labor market has lost jobs every month this year -- Heidi.</s>COLLINS: Boy, oh, boy. All right, Susan, we'll check back later with you for all of that. Also, don't let your mutual fund bleed you dry. Gerri Willis is going to be dropping by with tips for hanging on to your money during these tough times and this may be one of the best times to invest. Meanwhile, we want to get back to Ali Velshi standing by in our New York bureau, keeping an eye on oil and gas prices this morning, which, again, they are up.</s>ALI VELSHI, CNN SENIOR BUSINESS CORRESPONDENT: Yes, like they are almost every time we talk. I almost forget that we're sometimes together when oil prices are down. You know, some days. Heidi, they're up and we can't seem to find an explanation. In other days there are real reasons. So oil was up above $140 when it closed on Friday and then this morning it surged past $142, then past $143, up to $143.67. Now there was some news behind this. And that is that, in Nigeria, there was an attack on a Shell oil facility. After a few hours it was sort of learned that no oil would be -- you know, no production would be stopped so oil has actually settled down a bit, we're still above $142. Nigeria is very important. It's a major oil producer in the world. And in fact, it is the fourth largest producer of oil -- or supplier of oil to the United States after Canada, Saudi Arabia and Mexico. It's a much bigger supplier than Venezuela is. So we have some real issues that caused the price of oil to be higher this morning. But just to give you some perspective, Heidi, we started the year with oil at about $95 or so. When we hit $142.98, which it blew through this morning, that means oil is up 50 percent just for this half of the year. So in half a year we've gained 50 percent in oil. We also got an increase in gas prices, again, $4.08 a gallon. And you just think about these things. Nothing else in your life is up 50 percent. Your salary is not up 50 percent. Your investments are not earning 50 percent. That's a very big deal.</s>COLLINS: That's for sure.</s>VELSHI: Yes.</s>COLLINS: Yes.</s>VELSHI: And oil is the lifeblood of this country.</s>COLLINS: Yes, it is. I filled up over the weekend and I'm not even going to tell you how much I paid. It's brutal.</s>VELSHI: Yes, it hurts, doesn't it, these days. Yes.</s>COLLINS: Yes. It really does. All right, Ali Velshi, "Minding Our Business." Thank you, Ali.</s>VELSHI: OK.</s>COLLINS: To Iran now. U.S. commandos in Iran. A reporter says the White House is pushing the buttons on secret missions and the consequences could be serious. CNN senior Pentagon Jamie McIntyre live in Washington for us this morning. Good morning to you, Jamie. What's this all about?</s>JAMIE MCINTYRE, CNN SENIOR PENTAGON CORRESPONDENT: Good morning, Heidi. You know it's not clear what the U.S. is doing in Iran, but sources tell CNN that it has more to do with destabilizing or undermining the Iranian government than uncovering nuclear secrets.</s>MCINTYRE (voice-over): The allegation that U.S. special ops commandos have been conducting covert operations into Iran from southern Iraq drew a quick and unequivocal denial from the U.S. ambassador to Baghdad.</s>RYAN CROCKER, U.S. AMBASSADOR TO BAGHDAD: I can tell you flatly that U.S. forces are not operating across the Iraqi border into Iran in the south or anywhere else.</s>MCINTYRE: But investigative reporter Seymour Hersh, who's "New Yorker" magazine article claims the efforts are part of a $400 million covert campaign to destabilize Iran's government, argues the operations are so super secret, Ambassador Crocker may be out of the loop.</s>SEYMOUR HERSH, "NEW YORKER" MAGAZINE: He may not know the extent to which we're operating deeply, with commands are not so much with special forces inside Iran. So it's possible, because he's not somebody -- he'll spin it but he's not somebody who won't say something he doesn't believe.</s>MCINTYRE: It's not the first time Hersh has reported the U.S. has spies inside Iran. And senior Pentagon officials have hinted to CNN that CIA and other highly classified operations are conducted from time to time in the Islamic republic, but they have never confirmed it. In a statement, the CIA said, as a rule, it does not comment on allegations regarding covert operations. But some members of Congress were not so quick to dismiss the idea of the U.S. working secretly in Iran to stop its meddling in Iraq.</s>SEN. JOE LIEBERMAN (I), CONNECTICUT: I think we should be doing whatever we can to let the Iranians know they can't continue this and not expect us to take some action against them on this basis.</s>MCINTYRE: Hersh says some of the U.S. forces operating in Iran may be coming from the other border -- Afghanistan. And he suggests their mission is, in part, to gather intelligence about Iran's suspected nuclear weapons program, possibly to lay the groundwork for a military strike.</s>MCINTYRE: But Pentagon officials, who won't be identified because of the highly classified nature of the effort, suggest that what's going on here is a bit of a tit for tat. That is, the U.S. is trying to do to Iran what Iran is doing to the U.S. in Iraq, namely, supporting the forces that are attempting to oppose and destabilize the central government. They're trying to cause trouble for Iran to try to convince it to stop causing trouble for the U.S. in Iraq -- Heidi?</s>COLLINS: Yes, and I imagine the Pentagon and other forces are definitely going to want to keep these types of operations, special ops, you know, secret or covert anyway. Are we talking about cross-border raids here?</s>MCINTYRE: Well, you know, a lot of times what they're talking about -- first of all, it's not clear that some of these involve U.S. military forces. They could be CIA operatives. It's also not clear to what extent some of these operations, quote, "across the border" are actually through intermediaries who are working across the border but are having an effect in Iran. Obviously, the U.S. is doing a lot more to try to achieve its goals of changing the behavior of the Iranian government than it's saying publicly. And these kinds of operations are just shrouded in mystery. And often it's years before we ever find out what really happened.</s>COLLINS: Yes, typically seems to be the case there. All right, CNN senior Pentagon correspondent Jamie McIntyre. Jamie, thank you. We should learn more about the collision of two medical helicopters when investigators give a briefing at noon Eastern today. At least six people were killed, one critically injured when the choppers collided in Flagstaff, Arizona yesterdays. No one on the ground was hurt. The collisions sparked at 100-acre fire that was contained by the evening. We're going to get a live report from the scene coming up next hour. And over to Rob Marciano now in the Weather Center for us with more on what is happening across the country. We've got all kind of things firing up today. Hey, Rob.</s>COLLINS: Yes, I hope so. Boy, I heard about that air show in Huntsville.</s>ROB MARCIANO, CNN METEOROLOGIST: Yes, it was nasty.</s>COLLINS: That was awful. All right, Rob, we appreciate it.</s>MARCIANO: All right. Sure.</s>COLLINS: A baby guaranteed not to get one form of cancer. How doctors say they did it, coming up in the NEWSROOM.