U.S. MARKET AVERAGES

U.S. stocks traded in a lackluster fashion on Tuesday morning on mixed earnings news and disappointing November retail sales growth. In addition, Wall Street investors were cautious, awaiting the Federal Reserve''s latest decision on interest rates. Another quarter-percentage-point rate increase is expected, but investors are mostly interested in the outlook for rates and whether the long streak of rate hikes will end soon.

On the economic news front, the Commerce Department reported November retail sales growth of 0.3% which came slightly below economists'' estimate of 0.4%. Slowing sales at department and specialty stores raised concerns about the strength of the holiday shopping season, but the report also said that auto sales rebounded after a three-month decline, while gasoline sales fell as prices pulled back from record levels.

Electronics retailer Best Buy Co. (BBY: chart) fourth-quarter profit drop was somewhat offset by improved earnings guidance from consumer products maker Procter & Gamble Co (PG: chart).

Procter & Gamble said it expects Q2 earnings and sales to come in at the higher end of its guidance ranges, or 68 cents to 69 cents a share with sales higher by 25% to 26%. The company attributed its new sales outlook to strong performance from both the P&G and Gillette businesses and better-than-expected pricing contribution.

Best Buy Co Inc. posted Q3 7% earnings drop, hurt by higher expenses that outpaced a 10% sales increase, misses analyst estimates.

Investment bank Lehman Brothers posted a 41% jump in quarterly earnings on strength in investment banking and growth in transaction fees.

The retail sector dropped at the start of trading on disappointing November retail sales report. The computer hardware sector continued to weigh on the major averages after Hewlett Packard dropped on lowered guidance. The airline sector also traded in the negative.

The natural gas sector steadily advanced to post a gain of 1.9%. The drug sector rose by 1%, testing its 50-day moving average, a level it was last above in the second half of September.

In late morning trading, the Dow Jones industrial average lost 1.91, or 0.02%. The Standard & Poor''s 500 index was up 0.32, or 0.03%, and the Nasdaq composite index dropped 4.24, or 0.19%.

Bonds advanced, with the yield on the 10-year Treasury note sliding to 4.52% from 4.55% late Monday.

MOVERS AND SHAKERS

Best Buy Co., Inc (BBY: chart) posted third-quarter earnings of $138 million, or 28 cents a share, up from $125 million, or 25 cents a share, a year earlier. Total revenue rose 10% to $7.3 billion, and sales at stores open at least one year rose 3.3%. The quarterly results failed to meet expectations of 30 cents a share, and revenue of $7.34 billion. The stock dropped 10.7%.

CuraGen (CRGN: chart) said its Phase II trial of velafermin, which treats oral mocositis in patients receiving chemotherapy, failed to meet its primary endpoint. While velafermin reduced oral mucositis in come instances, the results were not statistically significant. The stock fell 22%.

Insmed Inc (INSM: chart), biopharmaceutical company, said the Food and Drug Administration has approved Iplex to treat growth failure in children with severe primary IGF-1 deficiency or with growth hormone gene deletion who have developed neutralizing antibodies to growth hormones. The company said that Iplex is entitled to seven years of marketing exclusivity for the treatment of primary IGFD. Company’s shares rose 24.7%.

Celanese Corp. (CE: chart) raised its 2005 earnings per share outlook to a range of $2.10 to $2.20, from the previous range of $1.95 to $2.05, citing continued strength of its Ibn Sina joint venture in Saudi Arabia, lower personnel costs, and a lower tax rate. The Dallas-based chemicals company also said it expects 2006 earnings in a range of $2.50 to $2.90. Thre stoch gained 6.9%.

ECONOMIC NEWS

The Department of Commerce released its report on November retail sales on Tuesday, showing that sales growth came in slightly below economist estimates. At the same time, the report showed a notable upward revision to October sales.

The Commerce Dept. said retail sales rose 0.3 percent in November, matching a revised increase in October. Economists had been expecting sales to grow by 0.5 percent in November compared to the 0.1 percent decrease originally reported for October.

The November sales growth was partly due to a rebound in sales by motor vehicle and parts dealers, which rose by 2.6 percent in November after falling 1.3 percent in October.