4:15PM Earnings, oil and trade deficit affect market trading.


-Dow up 40.34, Nasdaq up 4.32 and S&P up 1.55
- Crude oil closed down 36 cents $68.62 and gasoline reached a new high of $2.09.
- Gold closed up $1.90 to $601.30, silver up 6.3 cents to $12.66 and copper up 5 cents.
-Yield on 10-year bond closed at 4.976% and 30-year bond at 5.049%.

In the end market paid attention to earnings. Oil price, February trade deficit and rising bond yields affected the market averages but earnings news drove broader averages higher. Weekly Petroleum Report from Energy Department showed that the gasoline inventories fell but crude oil inventory is at eight year high. At the close oil prices dropped by a fraction ahead of weekend in several markets around the world.

February trade deficit of $65.7 billion is the third highest monthly deficit on record. Rising cost of oil contributed to record deficit. The U.S. has not registered a monthly trade surplus since 1964. Trade deficit with China was lowest in a year and dropped by 22% to $13.8 billion registered in March 2005. Average price of imported barrel of Crude oil rose to $53.72 from $51.93 a barrel. In the coming months oil price of imported variety will only be higher.

Circuit City (CC: chart), Gannett (GCI: chart), Harley Davidson (HDI: chart), Media General (MEG: chart), Genentech (DNA: chart) and LG Philips (LPL: chart) reported earnings. After the closed Adnaced Micro Devices (AMD: chart) reported earnings of 38 cents vs. loss of 4 cents on revenue of $1.33 billion beating the estimates of 30 cents a share.


3:30PM Russia, Indonesia and Venezuela rise. India and Hong Kong correct.
Emerging markets in Asia corrected sharply but markets in Russia and Latin America rose. Sharp decline of 1.5% in Japan led correction across the region with Hong Kong and India loosing 1.00% and 2.63% respectively. Indonesia and Philippines rose to a record level and Taiwan bounced back 0.8% at close. In Russia on the back of strong rise in metal prices and continues strength in oil and gas prices market index rose 0.5% to a new record of 1,562.

In Latin American markets Brazil rose 1.3% but Mexico fell 0.5% as markets neared closing. In Sao Paolo trading steel and iron ore companies gained a fraction but local telecom giant rose 1.9%. Mexican market ahead of holiday period declined on a thin volume. Cement maker Cemex lost 0.9% and Walmart de Mexico lost 1.3% but Femsa, local beverage bottler rose 1.5% in New York trading on broker upgrade. Oil price at elevated level helped Bolsa in Venezuela and Caracas index jumped 1.65%.


2:30PM Large cap stocks retain upward bias. Techs decline.
Market averages retained their positive bias in the late afternoon trading. Despite February record deficit of $65.5 and upward revision in the January deficit market ignored the persistent deficit. U.S. has not seen trade surplus since 1964.

John H. Harland (JHI: chart), software developer, revised Q1 earnings to 75cents to 78 cents from 60 cents to 65 cents. The company revised fiscal earnings to $2.90 to $2.95 from $2.73 to $2.78. Legg Mason (LM: chart) is to replace Guidant (GDT: chart) in the S&P 500 index. Motorcycle maker Harley Davidson (HDI: chart) released Q1 earnings of 86 cents vs. 77 cents a year ago on a revenue growth of 4% to $1.29 billion. The stock is down 6%. In the last five years the stock has barely budged and traded between $35 and $65. Publisher and TV station operator Media General reported Q1 earnings of 28 cents vs. 39 cents a year ago on a revenue growth of over 3%. Media General stock is down 1.4% and trading at 5-year low.

12:30PM European markets closed down.
European markets closed in the negative on profit taking and concerns that the strong increase in the oil price and the industrial metals will lead to higher interest rates. However, stock-exchange shares gained after the Nasdaq Stock Market acquired a 14.99% stake in the London Stock Exchange. Shares of the LSE jumped 15.4%. London FTSE 100 fell 0.3%, the German DAX 30 lost 0.1%, and the French CAC 40 dropped 0.3%.

11:30AM Stocks lost ground in late morning.
U.S. turned to lackluster trading after starting higher on strong earnings reports and a report from the Commerce Department that showed that February U.S. trade deficit narrowed sharply to $65.7 billion as well as a notable decline in the U.S. trade deficit with China. The upward momentum was also contributed by bargain hunting. Health insurance, biotechnology and gold stocks posted considerable strength. However, unable to sustain the early strength the major indices moved to the downside at mid-morning, helped by the release of an U.S. oil inventories report which showed a bigger-than-expected increase in crude oil inventories but a steeper-than-expected drop in gasoline inventories. Concerns about the impact of higher energy prices contributed to some weakness in the airline sector sending the Amex Airline Index down 0.9%. Shares of aerospace giant Boeing (BA: chart) rose 4% after Morgan Stanley raised its price target on the company to $110 from $80. The brokerage said that the company''s earnings could double from 2006 to 2009. In morning trading, the Dow Jones industrial average rose 49.46, or 0.45%. The Standard & Poor''s 500 index rose 2.30, or 0.18%, and the Nasdaq composite index rose 2.85, or 0.12%. Bonds fell, with the yield on the 10-year Treasury note at 4.95%, down from 4.93% late Tuesday.

Crude oil inventories advanced, while gasoline stocks dropped.
Crude oil inventories advanced again in the latest week, according to government statistics released Wednesday. This added to gains posted during the previous couple weeks. However, stocks of gasoline dropped yet again. The Department of Energy''s Energy Information Administration revealed that crude oil inventories climbed by 3.2 million barrels for the week ended April 7. Specifically, the measure rose to 346.0 million barrels from the prior week''s level of 342.8 million barrels. The move in the latest period followed 2 consecutive weeks in which oil inventories also advanced by 2.1 million barrels.

Prior to these advances, inventories had ticked down by 1.3 million barrels - the first decline in some time. In the most recent week, oil inventories were 7.8% higher than their levels of the same time last year. Gasoline inventories posted a week-over-week drop of 3.9 million barrels, the government said. This added to losses in the preceding 5 weeks, including a slide of 4.4 million barrels in the previous week. Gasoline stocks were 1.9% below their levels of last year. Inventories of distillate fuel oil declined again, falling by 4.2 million barrels in the most recent week. In the previous period, distillate inventories fell by 2.6 million barrels.


10:30AM Foreign investors kick-off a sharp sell-off in India.
Sensex in India lost 307 points or 2.6% to close at 11,355. After steadily rising for the last two years, the index has encountered its first loss of more than two percent since May 14, 2004. The day of BJP led government election defeat. In a volatile stock trading market changed hands for stocks worth $1.3 billion. Intra-volatility whipsawed most leading stocks in the session. Banking, IT and Telecom and cement makers declined during the session.

ACC, cement maker, lost 0.8% despite the company reporting strong fourth quarter ending March 2006 results. Profit rose 42% to $45 million on 19% rise in revenue to $230 million. Major players in Information Technology sector lost between 5% and 7% during the day. TCS lost 5% to Rs. 1,788 Satyam Computer lost 4.8% to Rs. 495 and Infosys dropped 3.6% to 3,071 at close. Tata Motors lost 4% on an unpaid sales tax collection charge from local tax collection authority. Cipla lost 5.7% to Rs. 682. The stock had jumped more than 15% in the last three sessions ahead of stock split of 3 for 2. Metal stocks remained firmed and some advanced as metal prices are likely to advance in the coming weeks. Sterlite Industries 6%, Hindustan Zinc rose 13% and Madras Aluminium rose 20% at close.