11:30AM Market averages rallied on a year-low crude oil and tame inflation.
A decline in crude oil prices to a one-year low and data showing tame consumer inflation drove market averages sharply higher. Crude-oil futures fell to $62.45 a barrel, extending a week-long slide on speculation that oil demand is weakening. The good news offset disappointment with Ford Motors Co.'s restructuring plan. Shares of the auto maker slid 14% on news it would cut its workforce by about 14,000 jobs and suspend the payment of its quarterly dividend.

Among Friday’s movers, shares of Bristol-Myers Squibb Co. (BMY: chart) advanced 1.4% following a news report that rival drug manufacturer Schering-Plough (SGP: chart) may wish to buy the company. Adobe Systems (ADBE: chart) climbed 11.7% after the company reported Q3 earnings that fell from year-earlier levels but exceeded expectations. Marsh & McLennan (MMC: chart) added 2.6% after it said it said it would cut 750 jobs or about 1.3% of its workforce, as part of its plan to cut costs by $350 million by the end of 2008. The Dow Jones industrial average was up 47.38 points, or 0.41%.The Standard & Poor's 500 Index was up 4.25 points, or 0.32%.The Nasdaq Composite Index was up 7.01 points, or 0.31%.


10:30AM The Sensex ends above 12,000 level in a narrow market-breadth.
The Sensex on BSE closed with a gain of 36.57 points, or 0.31%, at 12,009.59. The market-breadth was negative, with 1,055 shares advancing on BSE, 1,442 that declined and 72 shares that were unchanged. From the Sensex stocks 16 advanced while 14 declined. The turnover on BSE was Rs 3,444 crore, much lower than Thursday''s Rs 4,069 crore. The turnover on NSE was Rs 6,873.17 crore.

Advancers

Grasim led the advancers, gaining 3.69% to Rs 2,480.05 on a volume of 1.51 lakh shares. Satyam Computers jumped 2.28%, to Rs 828.60, L&T advanced 3.62% to Rs 2631 and Hindustan Lever moved up 1.55% to Rs 242.70. Index heavy Reliance Industries surged 1.20% to Rs 1,139.50 on a volume of 12.48 lakh shares. It peaked at an intra-day high of Rs 1,143.70, while the low was Rs 1,115.

Cement companies were in focus on hopes that cement prices may be raised shortly in view of robust demand, in the aftermath of the monsoon. Kesoram Industries was up 5% to Rs 450.15, JK Lakshmi Cement jumped 3.78% to Rs 162, Mangalam Cement soared 4% to Rs 207.60, ACC edged up 1.11% to Rs 945, Prism Cements gained 2.26% to Rs 40.80 and Shree Cements advanced 5.29% to Rs 1,048.

Engineering large-cap BHEL made an impressive come-back after sinking to a low of Rs 2,235.50. The company rose to Rs 2,281 and ended 0.45% higher, at Rs 2,275 on a volume of 67,833 shares.

Godrej Consumer Products spurted 2.77% to Rs 163 supported by a large block deal, involving 11 lakh shares on BSE, at Rs 160 per share, in early afternoon trade. Tea producer McLeod Russel gained 0.64% to Rs 125.20 on a heavy volume of 29.87 lakh shares following large block deals in early trade.

Decliners

Reliance Communications led the decliners, sagging 2.47% to Rs 316 on 14.91 lakh shares. Bajaj Auto was off 1.50% to Rs 2782, Hindalco lost 1.37% to Rs 169.20 and Infosys edged down 1.28% to Rs 1,806.

Metal stocks remained under pressure in a firm market, tracking weak metal prices on the London Metal Exchange (LME) on Thursday. The BSE Metal index lost 91.49 points or 1.1% to 8,222.92. Major losers in metals sector were Sterlite Industries (down 2.37% to Rs 445), Hindustan Zinc (down 2.46% to Rs 591.40), Hindustan Copper (down 3.47% to Rs 93.15), SAIL (down 2.71% to Rs 73.50), Tata Steel (down 0.96% to Rs 503) and Madras Aluminium (down 3.69% to Rs 360).

Active Traders

Reliance Capital was the most-active stock on BSE, with Rs 160.91 crore followed by Reliance Industries and Infosys with Rs 141.39 crore and Rs 106.27 crore respectively.

Select mid-cap stocks surged. Escorts soared 12.42% to Rs 107.70 on 61.94 lakh shares, Hercules Hoists jumped 10% to Rs 1,899.05 on 10,192 shares and Panama Petrochemicals advanced 10% to Rs 115.15 on 1.58 lakh shares.


9:45AM Stocks opened higher on inflation data.
Stock averages advanced at opening, boosted by data showing that U.S. consumer prices rose in line with market expectations in August. The Labor Department said that consumer price inflation moderated as gasoline and home ownership costs rose at a slower pace. Following the news retailers posted some strength, led by shares of consumer electronics retailers. Circuit City Stores Inc. (CC: chart) stock added 2.3%; while RadioShack Corp. (RSH: chart) gained 2.1%. Adobe Systems Inc. (ADBE: chart) led a rally in the tech sector Friday as the publishing-software developer''s shares surged 12% after reporting 24% rise in its Q3 sales. Other gains came from Apple Computer (APPL: chart), Hewlett-Packard (HPQ: chart), and Texas Instruments (TXN: chart).

The markets also benefited from weakness in the price of oil. In early trading, some housing, defense, and semiconductor stocks posted substantial gains. Among semiconductor stocks, California Micro Devices (CAMD: chart) surged 16.3% after raising its Q2 guidance. Unlike most blue-chip stocks, some high-profile companies in the automotive sector showed weakness Ford (F: chart) slipped 7.6% after plans to restructure the company fell flat. The company was downgraded by a number of Wall Street analysts. DaimlerChrysler (DCX: chart) dropped 7.8% after cutting its outlook. In the first hour of trading, the Dow Jones industrial average advanced 58.03, or 0.50%. The Standard & Poor''s 500 index added 5.99, or 0.39%, and the Nasdaq composite index rose 9.03, or 0.41%. Bonds rose, with the yield on the benchmark 10-year Treasury note easing to 4.77% from 4.79% late Thursday.

Industrial output declines unexpectedly in August.
Industrial production fell unexpectedly in the month of August, according to a report released by the Federal Reserve Friday morning. The report also showed a drop in the rate of capacity utilization. The report showed that industrial production fell 0.1 percent in August following an unrevised 0.4 percent increase in July. Economists had been expecting industrial production to increase by about 0.1 percent. The decrease in industrial production came as output from utilities fell 0.8 percent in August after rising 1.0 percent in July. Production at mines fell 0.3 percent, while manufacturing output was unchanged. The Federal Reserve also said that the capacity utilization rate fell to 82.4 percent in August from an upwardly revised 82.7 percent in July. Economists had expected the capacity utilization rate to come in flat compared to the 82.4 percent originally reported for the previous month.


09:00AM Stock futures advanced on CPI data.
U.S. stock futures advanced on data showing that consumer price inflation moderated in August as gasoline and home ownership costs rose at a slower pace. The CPI rose 0.2% after a 0.4% gain in July, while prices excluding food and energy rose 0.2% for the second straight month. The upbeat economic news helped offset disappointment over restructuring plans at Ford Motor. Trading is expected to be volatile as Friday marks the expiration of four options and futures contracts.