Russell advances as oil retreats

Small cap stocks are treading higher at mid-session, as crude oil futures pulled back and new home sales figures edged higher, stealing the limelight from a ghastly consumer confidence number.

At 12:46 p.m. ET. the Russell 2000 (NYSE:IWM) had gained 4.25, or 0.59%, to 728.35, while the Dow edged up 6.52, or 0.05%, to 12486.15. 

After breaching a record level of above $135 last week, crude oil prices shed $1.41 to $130.78 a barrel midday, as the oil market focused on a waning economy and weak consumer sentiment figure. The consumer sentiment gauge clocked in at 57.2, below the forecast of 60 and tumbled to a 16-year low.

“The drop in consumer confidence has got people nervous about the levels of the value of crude, specifically gasoline,” said Andy Busch, global foreign exchange strategist for BMO Capital Markets. “[They’re] thinking that these high prices will eventually encourage people to change habits.”

In other economic news, The U.S. Census Bureau and the Department of Housing and Urban Development reported this morning that sales of new one-family homes grew a greater-than-expected 3.3% in April to a seasonally adjusted annual rate of 526,000 from the revised March rate of 509,000, but was 42% below sales in April 2007. Economists were forecasting sales of 520,000. New home sales marked the largest year-over-year decline in 27 years.

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