4:00PM NY – 10:00PM Germany
Healthcare and defense stocks decline on the Democratic Party election win and resignation of Defense Secretary.

Yield on 10-year bond closed at 4.653% and the 30-year bond closed at 4.749%.

Gold decreased $1.40 to close at $616.90 a troy ounce, silver declined 4 cents to end at $12.51 a troy ounce and copper gained 0.50 cents to close at $3.2495 cents a lb.

Oil advanced $1 to close at $59.93 a barrel and heating oil gained 3.27 cents to finish at $1.713 a gallon. Gasoline increased 3.89 cents to end at $1.563 cents a gallon. Natural gas advanced 0.075 cents to close at $7.83 per mBtu.

Asian markets closed lower led by Philippines with a decline of 1.34%, Japan with a decrease of 1.08% and Hong Kong with a loss of 0.68%. The only advancer was Malaysia with a gain of 0.40%. Japanese stocks dropped on speculation of higher interest rates.

European markets ended lower led by Switzerland with a decline of 0.67%, Germany with a decrease of 0.20% and U.K. with a loss of 0.08%. The advancers were led by Spain with a gain of 0.23%, Belgium with an advance of 0.18% and Netherlands with an increase of 0.17%.

Latin America markets finished higher led by Argentina with an increase of 1.82%, Mexico with a gain of 1.20% and Brazil with an advance of 0.70%. There were no decliners.

1:00PM European markets closed down , dragged by pharmaceuticals.
European stock markets rebounded from yesterday’s gains to close down, reflecting cautious amid the election victory of the U.S. Democrats. Drug stocks were among the biggest losers on fears that if the Democrats win both the House and the Senate, they might enforce lower drug prices, which could pressure the drug industry. AstraZeneca slipped 2%, GlaxoSmithKline dropped 1.6%, Novartis fell 1%, while Roche lost 0.5%. In earnings news, European defense giant and Airbus owner EADS swung to a Q3 net loss of 195 million euros on charges.

However, the stock rose 3.2% as the company confirmed it expects sales of well above 37 billion euros in 2006. EADS swung to a Q3 net loss of 195 million euros on charges. Shares in German retailer KarstadtQuelle rose 2.7% on narrower quarterly loss. The two leading European automakers traded mixed on CEO shake-ups. Peugeot rose 1.8%, while Volkswagen slipped 1.5%. The German DAX 30 fell 0.2%, London FTSE lost 0.1%, while the French CAC 40 was flat at 5,437.10.

Crude oil climbed back above $60 a barrel on weaker gasoline and diesel fuel inventories. Crude oil December contract rose $1.20 to $60.16 a barrel. Gasoline added 5 cents to $1.5720 a gallon, while heating oil rose 4 cents to $1.7215. Natural gas futures gained 8 cents to $7.83 per 1,000 cubic feet. The U.S. dollar gained ground against its rival currencies. The euro was quoted at $1.2759, down from $1.2771. The dollar bought 117.86 yen, up from 117.68. The British pound stood at $1.9028, down from $1.9055. European gold prices declined. In London, gold traded at $623.60 per troy ounce, down from $625.75. In Zurich, the precious metal traded at $623.23 per ounce, down from $624.65. Silver closed at $12.62, up from $12.61.


11:30AM Drug companies Merck and Pfizer led the S&P 500 down.
Worries about the impact of the U.S. election results, kept stocks under pressure on Wednesday. Among pharmaceutical stocks, shares of drug maker Merck & Co. (MRK: chart) dropped 3.3% after the drug maker revealed that it faces a tax liability of $5.58 billion due to four tax disputes in the U.S. and Canada. Rival company Pfizer Inc.''s (PFE: chart) fell 1.9%.The two Dow components were the biggest drags on the S&P 500. Health insurance stocks also moved to the downside, led by Molina Healthcare (MOH: chart), with the managed care company falling 8.3% after the company reaffirmed full-year outlook below estimates. The weakness in the health insurance sector also came amid concerns that a Democrat-controlled congress could have a negative impact on the industry. Shares of Wal-Mart Stores Inc. (WMT: chart) also came under pressure, falling 0.6%.

In contrast, companies in the mortgage business posted gains on the notion that Democrats would push plans to broaden access to housing. Fannie Mae (FNM: chart) rose 2.3%, while Freddie Mac (FRE: chart) advanced 2.4%. Rising oil prices and a broker upgrade helped shares of Exxon Mobil Corp. (XOM: chart) gain 1 percent to $73.26. The stock was a leading gainer in both the Dow and S&P 500. Sirius Satellite Radio Inc. (SIRI: chart) rose 2% after posting a narrower-than-expected loss on improved revenue. In late morning trading, the Dow Jones industrial average moved off earlier lows and was down 12.88, or 0.11%, at 12,143.89. The Standard & Poor''s 500 index was down 1.31, or 0.09%, at 1,381.53, and the Nasdaq composite index fell 1.79, or 0.08%, to 2,374.09. Bonds showed little movement, with the yield on the benchmark 10-year Treasury note flat at 4.66% from late Tuesday

While some weakness is also visible among airline, defense, and housing stocks, tobacco stocks are seeing some strength in morning trading. The Amex Tobacco Index is currently up 1.2 percent, at an all-time intraday high.

Universal Corp. (UVV) is turning in one of the sector''s best performances after the leaf tobacco distributor reported adjusted second quarter earnings that rose year-over-year. Shares of Universal are currently up 3.9 percent.


10:30AM The Sensex falls for a second day in a row on selling pressure.
The Sensex on BSE finished 84.15 points, or 0.64%, lower to 13,072.51. The market-breadth positive at the start of trading turned weak in late trading. As 1,1628 shares declined on BSE, only 881 advanced and 64 stocks were unchanged. For every 2 decliners there was 1 advancer. From the Sensex stocks, 22 declined while the rest advanced. The turnover on BSE was Rs 4,305 crore, lower than Rs 4,688 crore on Tuesday. The turnover on NSE was Rs 8,572.66 crore, lower than Rs 9,066.78 crore on Tuesday.

Decliners

The auto sector was in decline today. The costs of materials such as nickel, aluminium, rubber and steel is rising. Hero Honda led the decline, down 3.77% to Rs 715, on 2.16 lakh shares. It slid to a low of Rs 705.45, after hitting a high of Rs 744 in early trade. Advancing input costs and intense competition forced investors into selling shares of auto firms. Bajaj Auto fell 3.37% to Rs 2,630 and TVS Motor was down 5.16% to Rs 102.

Maruti Udyog dipped 1.1% to Rs 933.50, following the Heavy Industries Minister Santosh Mohan Deb announcement that he had formally proposed the selling of the remaining 10% government stake in the company. Tata Motors also declined 2.36% to Rs 799.