When markets want to go down, they will find an excuse. Yesterday the excuse was oil, as West Texas Intermediate (WTI) spiked to their highest level since July 21, finishing at $49.20/barrel. Brent gained 7.2% to finish at $55.39. Oil dragged a rather nervous market sentiment. Before the bell (U.S.), it’s down again. People who had been shorting oil are now as frightened as those who were long oil a few weeks ago.

The spike was caused by Energy Information Administration data showing that the U.S. pumped 9.3 million barrels per day in June, down 100,000 barrels/day from May, and 250,000 barrels/day less than estimated just a few weeks ago. The OPEC monthly bulletin also had an article saying the Organization of Petroleum Exporting Countries is ready to talk to non-OPEC states about moderating production to drive prices above costs.

As a result the NASDAQ, which features technology stocks, led the way down, falling 1.06% to finish at 4,776, down 6.39% for the month, while the broad S&P 500 average dropped .84%, or 16.69, to 1,972, and the Dow Jones dropped .69%, 114.98, to finish at 16,528. The Volatility Index or VIX was up 9.14% to finish the day at 28.43.

So Buy the Oils?

Stocks tied to oil also rose, but only modestly. Exxon Mobil (NYSE:XOM) was up 21 cents or 0.28%, to finish at $75.28. Chevron (NYSE:CVX) was up 52 cents, .65%, to finish at $80.95. Conoco Philips (NYSE:COP), which was formerly an integrated oil company before spinning off its refining and marketing as Philips 66 (NYSE:PSX), rose $2.32, nearly 5%, to finish at $49.14. (Philips was up $1.84, 2.38%, to $79.07 on word Warren Buffett had taken a $4.5 billion position in the company.)