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By Jason Stipp | 02-25-2011 03:00 PM

Same Characters, Different Stories

The names may be the same, but some of the stories are changing for Wal-Mart, HP, GM, and the home-improvement stores.

Jason Stipp: I'm Jason Stipp for Morningstar and welcome to the Friday Five.

It's Usual Suspects Week on the Friday Five. Names you've heard before, but have the stories changed?

Here with me to offer the details is Morningstar's markets editor, Jeremy Glaser.

Jeremy, thanks for joining me.

Jeremy Glaser: You're welcome, Jason.

Stipp: So, what you have for the Friday Five this week?

Glaser: Well, this week we're going to take a look a look at oil shocks, at Wal-Mart, at Home Depot and Lowe's, General Motors, and finally, we'll take a look at Hewlett-Packard.

Stipp: So, Jeremy, after a period of relative calm at the beginning of the year, we've had some turmoil overseas. It's causing oil to spike, and it's causing a lot of concerns. What's the story there?

Glaser: Oil shocks are certainly nothing new. Since the 1970s, really as a nation, we've had a lot of handwringing about the effect of higher oil prices and suddenly higher oil prices, and this is important. Oil prices affect a ton of industries, from airlines, to anyone who wants to ship anything, to even auto makers if gas prices were very high. Certainly, we have a lot to worry about if oil prices double from their current levels--not than anyone is predicting that.

This week, with further unrest in North Africa and the Middle East, and particularly in Libya, we had more concerns about what's going to happen with the price of oil. Supply, it looks like, could be constrained, even if not by a lot right now, it's still a constraint, and demand is continuing to rise, particularly from emerging markets. That imbalance is going to lead to higher prices, and that's going to have a lot of knock-on effects throughout the United States' economy.

Now, is this going to be enough to derail the recovery? I think it's too early to say. Certainly, it's going to have an impact, but I think a lot of it will depend on how long these oil prices stay high, if other producers such as Saudi Arabia are able to produce more oil or if they also get caught into the turmoil and produce less oil. So, those are really the big open questions.

So, it's too early to say if oil or other commodities are going to knock us off course, but oil shocks are nothing new and something that we could be talking about for a while.

Stipp: In corporate news, Wal-Mart reported, I guess we could say, results that failed to inspire. Is this the same old story from them? What's been going on with their earnings trends?

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