11:30AM Market averages traded in a lackluster fashion.
U.S. stocks traded in a lackluster fashion on bargain hunting. Investors weighed brokerage upgrades of giant automakers and the semiconductor sector along with earnings reports from companies like MasterCard and Gateway. General Motors Corp. (GM: chart) supported the Dow with an advance of 7% following positive analyst comments about the automotive sector. MasterCard Inc. (MA: chart) fell 8.6% after hitting a new 52-week high of $118.07. Computer maker Gateway (GTW: chart) slipped 8.4% amid plans to cut $20 million to $25 million in expenses and cut more jobs. Crude oil prices hovering round $60 a barrel also attracted attention.

Market also reacted to the first day of trading of Fortress Investment Group. (FIG: chart). Shares of the company started trading 89% higher at $35, as the company became the first U.S. hedge fund and private equity group to go public. Fortress priced its IPO at $18.50 a share, at the top end of a previously disclosed range of $16.50 to $18.50. The offering raised $634 million for Fortress. The new stock was recently up 74%.

In merger-and-acquisition news, auto parts supplier Lear Corp. (LEA: chart) agreed to be acquired by a group affiliated with billionaire investor activist Carl Icahn for about $2.8 billion. Under terms of the agreement, Icahn-controlled American Real Estate Partners LP will pay $36 a share. The offer represented a premium of 4% over the stock's closing price last Friday of $34.67. Lear's shares fell 3.9% in morning trading. In late morning trading, the Dow Jones industrial average was up 16.18, or 0.13%, at 12,653.81. The Standard & Poor's 500 index rose 0.99, or 0.07 percent, to 1,449.30, and the Nasdaq composite index was down 4.74, or 0.19%, at 2,483.93. Bonds fell sharply following Poole's comments; the yield on the benchmark 10-year Treasury note rose to 4.77% from 4.73% late Thursday.


9:45AM Upgrades drove market opening up.
Upgrades for the Big Three automakers and a sector upgrade for the semiconductor industry boosted U.S. market opening. Ford Motor (F: chart) rose 3.6% and General Motors (GM: chart) increased 5.1% after Deutsche Bank upgraded their stock on hopes for favorable healthcare negotiations. Citigroup upgraded Daimler Chrysler (DCX: chart) sending its stock 2.3% higher. Among chip stocks, Dow component Intel added 0.5%.

Companies releasing earnings reports included Gateway Inc., MasterCard International Inc. and Weyerhaeuser Co. Gateway Inc. (GTW: chart) stock fell 7% as the computer maker''s quarterly revenue fell 9% from year-earlier levels. MasterCard Inc. (MA: chart) said its Q4 net income exceeded expectations as strong consumer spending boosted transactions. The company posted quarterly profit of $41 million, or 30 cents per share, compared with a loss of $53 million, or 39 cents per share, a year earlier. Revenue rose 17.2% to $839 million from $716 million a year ago. MasterCard raised its quarterly cash dividend by 66.7% to 15 cents per share from 9 cents per share. The results drove shares of MasterCard to an all-time high before tumbling 5% in early trading.

Weyerhaeuser Co (WY: chart), forest products maker, said it swung to a Q4 profit from a year-ago loss. The company posted earnings of $1.88 per share, compared with a loss of 86 cents per share, beating estimates of 75 cents a share. Revenue fell 1% to $5.66 billion. In the first hour of trading, the Dow Jones industrial average was up 33.17, or 0.26%, at 12,670.80. The Standard & Poor''s 500 index was up 4.00, or 0.28%, at 1,452.31, and the Nasdaq composite index was up 7.77, or 0.31%, at 2,496.44.


9:00AM Market futures traded flat. The Big Three received a broker upgrade
U.S. stock futures traded near the flat line Friday, with investors digesting broker upgrades of the Big Three automakers and a jump by crude oil prices. Hedge fund operator Fortress Investment Group was also in focus, as the market awaited its first trading day after it priced its initial public offering late Thursday. General Motors (GM: chart) rose 2.6% and Ford Motor (F: chart) climbed 4% after the car makers were upgraded by Deutsche Bank to buy from hold, on hopes for favorable healthcare negotiations. DaimlerChrysler (DCX: chart) was upgraded to buy at Citigroup ahead of its restructuring plan for Chrysler. Fortress Investment Group (FIG: chart) priced its initial public offering at $18.50 per Class A share, the top end of its indicated range. The hedge fund operator is due to kick off trading Friday.

In other broker moves, J.P. Morgan raised its rating of the U.S. semiconductor sector to bullish from cautious on expectations that several leading indicators will begin to improve in the second quarter. Leading chip maker and Dow member Intel (INTC: chart) was up 0.3% in the pre-open. On the corporate news front, Alcatel-Lucent (ALU: chart) said it would cut 12,500 jobs, over 3,000 more than it originally planned. It reported Q4 operating profit decline in line with expectations. The stock was down 0.7% ahead of the open. Among other pre-market highlights, Hasbro (HAS: chart) reported better-than-expected Q4 earnings and revenue and lifted its quarterly cash dividend by 33%. Gateway Inc. (GTW: chart) reported a 9% revenue decline. Quiksilver (ZQK: chart), the sports apparel maker, cut its forecast. S&P 500 futures inched 0.20 of a point higher to 1,454.10 and Nasdaq 100 futures were unchanged at 1,821.75. Dow industrial futures were also unchanged.


8:30AM Laidlaw International agreed to be bought by the U.K.’s First Group for $3.6 B.
Laidlaw International Inc. (LI: chart) agreed to be acquired by the U.K.''s First Group Plc in a deal worth $3.6 billion, including the assumption of around $700 million of debt. First Group said it will pay $35.25 a share for Laidlaw, the biggest school and intercity bus operator in the U.S. The deal represents an 11% premium to Thursday''s closing price.

The U.K. group, which operates bus and rail services across Britain, said the deal will create a more robust business and should result in annual cost savings of around $70 million. But First Group said that Laidlaw''s Greyhound intercity bus service could be sold off after the deal as it may not fit with its own operations. Greyhound has around 11,000 staff and contributed to roughly 40% of the U.S. group''s $3.1 billion revenue in fiscal 2006.

Laidlaw agreed to pay First Group a fee of up to $78 million in certain circumstances if the deal does fails, while First Group would pay a break fee of $43.35 million. Shares in First Group gained 4.5% in London. Laidlaw shares jumped 8.8% in pre-market trading.


7:30AM NY-6:30PM Mumbai Sensex declines Friday on inflationary data.
Sensex in India reached a new intra-day high of 14,724 but quickly lost the momentum and fell to close at 14,724. Weekly measure of wholesale price index fueled the fears of interest rate hike. Stocks in banks, cement and IT sectors fell. Rupee rose. Bajaj Auto soared 17% on news reports of various Bajaj related financial firms to be consolidated. Foreign investors continue to add new funds in the Mumbai market.

Trading Highlights

The 30 share index BSE Sensex lost 114 points to close at 14,538.90. In the early morning trading the index rose to a new intra-day high to 14,724 but quickly lost its upward momentum. The index traded with 466 points volatility and lost ground in the afternoon trading. Of the thirty stocks in the index only seven stocks rose and the rest declined. Market breadth was weak and in trading on BSE 622 stocks gained, 2,043 lost and only 45 stocks were unchanged.

On BSE trading market turnover declined to Rs 4,332 crore from Rs 5,136 crore in Thursday trading. According to preliminary international trading data, foreign institutions invested net of Rs 2,211 crore between February 2nd and 7th of this year.

Reliance Industries, Zee Telefim, Reliance Communication, Larsen & Toubro and State Bank of India were the most active stocks based on market turnover statistics reported by BSE daily report.