1:00PM European markets closed steeply higher.
European stock markets closed sharply higher, ending a five-session losing streak. The markets reversed from weakness after comments from Fed Reserve Chairman Ben Bernanke helped the U.S. dollar recover vs. the euro and the pound. The European common currency dropped 0.4% to $1.3140. The recovery of the greenback reflected strength in the shares of exporter stocks. Automakers BMW and DaimlerChrysler both gained 1%, while Voklswagen rose 4.3% on brokerage upgrade. Pharmaceutical giants also contributed to the advance. AstraZeneca, GlaxoSmithKline, and Sanofi Aventis rose 3% each after Pfizer announced a plan to cut 20% sales force. The French CAC 40 led regional gainers, rising 1.4%, followed by the German DAX 30, up 1.3%, and London FTSE 100, up 1%.

Crude oil prices rose nearly $1 amid data, showing weaker fuel supplies. Crude oil January contract rose 96 cents to $61.95 a barrel. London Brent climbed 40 cents to $61.61. The U.S. dollar gained ground against its major currency rivals. The euro was quoted at $1.3153, down from $1.3189. The dollar bought 116.12 yen, up from 116.10. The British pound was quoted at $1.9490, down from $1.9509. European gold prices declined, as the dollar gained. In London, gold traded at $635.50 per troy ounce, down from $636. In Zurich, the precious metal traded at $637.08 per ounce, up from $637.05. Silver closed at $13.64, down from $13.46.


11:30AM Stocks trade higher, despite weak home sales data. Oil majors gained.
Stocks continued to post gains Wednesday on the back of strong GDP growth in Q3, shrugging off weak home sales data. A report released by the Commerce Department showed 3.2% decline in new home sales, largely due to a steep drop in sales in the Northeast.

Oil companies moved higher, as crude oil prices gained nearly $1 after weekly petroleum data showed U.S. inventories fell more than expected. Exxon Mobil (XOM: chart) rose 1% and ConocoPhillips (COP: chart) rose 1.6%, leading the S&P 500 index higher. Significant strength also emerged in the pharmaceutical sector, with AstraZeneca (AZN: chart) helping to lead the sector higher, as the drug maker rose 3.7%. Shares of GlaxoSmithKline (GSK: chart) and Schering Plough (SGP: chart) were other notable advancers, each rising 3%.

The markets also benefited from strength among airline, internet, and retail stocks. Tiffany (TIF: chart) helped to lead the retail sector higher after the jewelry retailer said Q3 profit grew a stronger-than-expected 23% and raised its full-year guidance. The stock climbed 7%. Telecommunications stocks also posted strong gains, with Qwest (Q: chart), up 3.6%, America Movil (AMX: chart), up 3.2%, and BellSouth (BLS: chart), up 3.6% turning in some of the sector''s best performances.

Among companies, driven by analyst comments, Shanda Interactive (SNDA: chart), developer of online games, jumped 8.4% after J.P. Morgan upgraded its rating on the stock to overweight from underweight. Shire (SHPGY: chart), specialty pharmaceutical company, rose 4% after HSBC Securities upgraded its rating on the company''s stock to overweight from neutral. On the other hand, shares of Patterson (PDCO: chart), dental products distributor, dropped 2.6% after Credit Suisse downgraded the stock to neutral from outperform. In late morning trading, the Dow Jones industrial average rose 90.12, or 0.74%, to 12,226.57. The Standard & Poor''s 500 index was up 12.08, or 0.87%, at 1,398.80, and the Nasdaq composite index added 22.74, or 0.94%, to 2,435.35. Bonds were mostly flat, with the yield on the benchmark 10-year Treasury note edging lower to 4.51% from 4.50% late Tuesday.


Crude oil inventories and gasoline stockpiles declined.
Crude oil inventories ticked down in the most recent week, according to government statistics released Wednesday. This broke a recent streak of gains. Meanwhile, gasoline stockpiles also experienced a draw down, resuming a decline after an advance posted in the previous week. The Department of Energy''s Energy Information Administration said that crude oil inventories slipped 300,000 barrels in the week ended November 24. Specifically, the measure dipped to 340.8 million barrels from the previous week''s level of 341.1 million barrels. This broke a recent streak of gains, including an advance of 5.1 million barrels in the previous week and a gain of 1.3 million barrels in the week before that. Oil inventories for the November 24 week were 5.7% higher than last year. Meanwhile, gasoline inventories showed a week-over-week decline of 600,000 barrels. This followed an advance of 1.4 million barrels in the previous week, which broke a streak of declines. The level of gasoline inventories was 1.6% below last year. Distillate fuel oil had an inventory decline during the week ended November 24. Stockpiles of these products, which include heating oil, fell by 1 million barrels. This added to a decline of 1.2 million barrels in the previous week.

New home sales slumped 3.2% in October.
Wednesday morning, the Department of Commerce released its report on new home sales in the month of October, showing that sales fell after showing a notable increase in the previous month. The decrease was largely due to a steep drop in sales in the Northeast. The report showed that new home sales fell 3.2 percent to a seasonally adjusted annual rate of 1.004 million units in October from a downwardly revised September rate of 1.037 million units. Economists expected sales to fall to a 1.040 million unit rate from the 1.075 million unit rate originally reported for the previous month. With the downward revision to data from the previous months, new home sales rose 3.7 percent in September compared to the 5.3 percent increase that was reported last month.

As mentioned above, the decline in new home sales in October was due in large part to a steep drop in sales in the Northeast, which fell 39.0 percent compared to the previous month. New home sales in the Midwest fell 5.6 percent and sales in the South fell 1.7 percent, while sales in the West rose 3.2 percent. The report also showed that the median sales price of new houses sold in October of 2006 was $248,500, a 1.9 percent increase compared to October of 2005. The Commerce Department added that the seasonally adjusted estimate of new houses for sale at the end of October was 558,000, representing a supply of 7.0 months at the current sales rate.


10:30AM The Sensex finishes higher boosted by small-caps and mid-caps.
The Sensex on BSE finished 14.78 points or 0.1% higher at 13,616.73. The market breadth was extremely positive as out of 2,623 stocks traded, 1,658 advanced, 890 declined and 73 were unchanged today. For every three advancers, there were two decliners. From the Sensex stocks 16 declined while the rest advanced. The turnover on BSE was Rs 4388 crore compared to Rs 4161 crore on Tuesday. The turnover on NSE was Rs 8,083.89 crore lower than Rs 8,257.71 crore on Tuesday.

Economic news

The government yesterday issued second tranche of special bonds worth Rs 5,000 crore to oil marketing companies to help them offset losses due to high international crude prices.

Most active

Lanco Infrastructure was the most-active stock with a turnover of Rs 294.50 crore followed by Info Edge, Unitech, Action Constructions and Reliance Communications.

Advancers

Cement shares continued their recent move upwards on firm cement prices. ACC gained 3.6% to Rs 1,140, Gujarat Ambuja Cements advanced 2.3% to Rs 146.55 and Grasim gained 2% to Rs 2,770. Cigarette large-cap ITC advanced 2.5% to Rs 184.40.

Recently listed Lanco Infratech jumped 14% to Rs 267. The stock rose on huge volume of 1.1 crore shares on BSE.