4:30PM NY, 10:30 PM Frankfurt, 1:00AM Mumbai – Global Markets

Yields edged higher on 10-year U.S. bonds and closed at 5.248% and 30-year bond rose to close at 5.358%.

Crude oil fell 65 cents to close at $65.02 per barrel, natural gas gained 4 cent to close at $7.65 per mBtu, and gasoline futures down 2.87 cents to close at 212.26 cents per gallon.

Gold fell $5.90 to close at $653.10 per ounce, silver lost 18.5 cents to close at $13.09 per ounce, and copper futures advanced $228 to close at $7,448 per metric ton.

Asian Markets closed higher across the region except Thailand and Japan. Investors are showing willingness to accept higher energy and commodity prices and factoring higher profit for companies in the sector. Higher metals and oil prices drove mining and energy companies in Australia, India and Japan higher. Of all the indexes in the region, Shanghai led Asia with a gain of 2.7% followed by a rise of 1.2% in Philippines and Indonesia, 0.8% advance in South Korea, and 0.4% increase in Singapore, India and Taiwan. Hong Kong and Australia edged up 0.1%. Japan fell 0.4%.

Non-life insurance companies in Japan traded lower with sharp losses as investors booked profit on robust gain in the sector in the last three months of trading. Mitsui Sumitomo Insurance fell 4.5%, Kawasaki Kishen Kaisa dropped 4.6%, and Nippon Yusen declined 2%.

Central Statistical Organization, the government arm for economic data in India reported April industrial production surged 13.6% and revised March production increase to 14.5%. Manufacturing output rose 15.1% and electricity production jumped 8.7% in the month. Strong rise of 17.7% in demand for consumer goods was reflected in manufacturing report. Rising salaries and stable income in various sectors is fueling demand for housing which drives consumer goods demand. Cement stocks rallied on the report that cement production jumped 10% in the month.

May consumer price inflation in China was reported at 3.4% up from 3% in April on 26% rise in meat prices, according to National Bureau of Statistics. The Central bank has inflation target of 3%. Household deposits fell by $36 billion in the month of May, a monthly decline for the first time since February 2003.

In Shanghai trading investors shrugged of rising inflation and drove the index higher 2.7%. China Agri-industries fell 10% on the news that the company may not be allowed to use grain for bio-fuel production. Industrial companies in Shanghai trading registered a sharp gain. Crane maker Shanghai Shenhua and Chonqing Changan, and Datang International Power were among the 20 stocks in the CSI index of 300 stocks that closed up reaching daily limit of 10%. China Unicom fell 2% after surging 6% in previous trading in Hong Kong.

Brokerage and shipbuilding stocks rally led the main index in Korea higher but chip makers closed lower. Hyundai Heavy Industries and Samsung Heavy Industries gained 3% on higher shipping freight rates and expectations of rising earnings.

European Markets closed lower on the worries that interest rates across the region may continue to increase. Spain and Norway fell 1% followed by 0.7% decline in UK, the Netherlands and France. Bank of England Governor indicated that if certain economic indicators fail to decline than the Bank may have to react.

In trading, UK based mortgage lender HBOS fell 3.6% on the news that its market share is likely to have declined to 8% in the first six months of this year from 21% in 2006 and dragged other mortgage companies lower including Royal Bank of Scotland decline of 2.7%.

Chip tech stocks fell on the news that Texas Instruments will report lower than expected earnings. Texas Instruments reported second quarter earnings forecast between 40 cents and 44 cents from the previous guidance between 39 cents and 45 cents. Nokia dropped 1.8%, Infineon dropped 0.3%, STMicro and ARM Holdings lost 1.5%.

Swedish telecom company TeliaSonera rose 3% on the news that the company has replaced its CEO with its current CFO. Voestalpine jumped 3% on Credit Suisse upgrade, Clariant AG, specialty-chemical company, dropped 3% on the news that Morgan Stanley has sold stocks worth $56 million.

Latin American Markets closed lower tracking New York trading. Brazil Bovespa declined 1.8% and led the region, followed by 0.9% fall in Argentina and 0.7% decrease in Mexico. Chile edged up 0.13%.

Telecom companies in Brazil and Mexico fell after rising in previous session. Banco Bradesco fell 1.3% and Banco Itau dropped 1%. Embraer, Brazilian plane maker is considering building military transportation plane with an investment of $600 million. The company defense division chief said that the unit sales are less than 6% of total sales and company may issue more shares to fund the project.

Colombia is expected to finish $1 billion bond sale in international market with 20-year maturity in 2027. The proceeds will be used to pay for bonds maturing between 2008 and 2016. The bonds with ratings of BB+ are priced to yield with a minimum yield of 9.85%.

1:00PM NY, 5:00 PM Frankfurt European markets closed down as banking shares weighed.

European stock markets retreated from yesterday’s gains to close down on Tuesday. Uncertainty about the direction of global interest rates continued to weigh on the sentiment, driving investors to sell banking shares.

The banking sector was one of the worst performers, as HBOS shares dropped 3.6% after it said its position in the U.K. mortgage market fell sharply in the first half of the year. Among other U.K. mortgage banks, shares of Bradford & Bingley fell 2.3% and Northern Rock dipped 2.8%.