1:00PM European markets closed down, dragged by miners and oil majors.
European stocks closed down Thursday amid uncertainty related to inflation and economic growth after minutes from the Federal Reserve''s latest monetary-policy meeting. Miners were among the heaviest decliners, with BHP Billiton, and Rio Tinto falling more than 3.5% as copper prices continued to decline. Oil companies like Royal Dutch Shell and Total fell 1.2% amid a sharp decline by the oil price. Brokers also weighed. HSBC Holdings fell 1% in London after ABN Amro downgraded the banking group to sell from hold. ABB shares fell 3% in Switzerland after it was downgraded by Prudential Equity Group, citing valuation. Among other movers of the day, shares of German chemicals and pharmaceutical company Merck KGaA rose 6.5% after a report that it may sell its generic-drugs division in a deal of over 4 billion euros. The French CAC 40 was the biggest decliner, falling 0.7%, followed by London FTSE 100, down 0.5%, and the German DAX 30, down 0.3%.

Crude oil prices slipped below $57 a barrel on ample supplies. Crude oil February contract tumbled $1.49 to $56.83 a barrel. London Brent slipped $1.65 to $56.31 The U.S. dollar advanced against its major currency rivals. The euro was quoted at $1.3083, down from $1.3165. The dollar bought 119.34 yen, down from 119.35. The British pound was quoted at $1.9433, down from $1.9505. European gold prices declined. In London, gold traded at $627.10 per troy ounce, down from $635.25. In Zurich, the precious metal traded at $626.65 per ounce, down from $635.90. Silver closed at $12.74, down from $12.88.


11:30AM The Nasdaq moved higher, helped by semiconductors.
The U.S. stock markets turned mixed in late morning trading, as expectations of lower gasoline prices offset concerns about consumer spending. Oil prices dropped $1.60 to $56.72 a barrel after the government reported inventories of gasoline, heating oil and diesel fuel rose more than expected in the last week of 2006. Energy stocks were among the most notable decliners, with Exxon Mobil ((XOM) falling 1.2%. Chevron Corp. (CVX: chart) and British Petroleum PLC (BP: chart) also declined. The Dow was also pressured by notable losses posted by McDonald''s (MCD: chart), down 1.6%, AT&T (T: chart), down 1.6%, and DuPont (DD: chart), lower by 1.2%. Disappointing data on the services sector and December retail sales further pushed blue-chip stock lower. However, retailers, which suffered weakness earlier in the session, recovered on speculations that lower gasoline prices could boost consumer spending.

In contrast, the Nasdaq moved above the flat line. The advance by the tech-heavy average was largely contributed by strength in the semiconductor sector. Intel (INTC: chart) climbed 3.8%, helping to lead the sector higher after Banc of America raised its earnings estimates for the semiconductor giant. Strong gains by some biotechnology and internet stocks also provided a boost. In late morning trading, the Dow Jones industrial average fell 10.25, or 0.08%, to 12,464.27. The Standard & Poor''s 500 index was down 0.89, or 0.06%, at 1,415.74, and the Nasdaq composite index added 13.59, or 0.56%, to 2,436.75.


Crude oil inventories fell, while gasoline stockpiles gained.
Crude oil inventories fell in the most recent week, according to government statistics released Thursday. Meanwhile, gasoline stockpiles experienced a significant build. The Department of Energy''s Energy Information Administration said that crude oil inventories slipped 1.3 million barrels in the week ended December 29. Specifically, the measure dipped to 319.7 million barrels from the previous week''s level of 321 million barrels. Oil inventories for the December 8 week were 1.2% lower than last year. Meanwhile, gasoline inventories showed a week-over-week increase of 5.6 barrels. The level of gasoline inventories was 0.7% above last year. Distillate fuel oil also had an inventory increase during the week ended December 29. Stockpiles of these products, which include heating oil, rose 2 million barrels.

Factory orders gained 0.9% in November.
The Department of Commerce released its report on new orders for manufactured goods in the month of November on Thursday, showing that orders rebounded less than expected after a steep decline in the previous month. The report showed that orders rose 0.9 percent in November following a revised 4.5 percent decline in October. Economists had expected orders to increase 1.4 percent compared to the 4.7 percent decrease originally reported for the previous month. The increase in orders came as new orders for manufactured durable goods rose 1.6 percent in November following an 8.1 percent decrease in October. The Commerce Department also said that new orders for manufactured non-durable goods increased slightly. The Commerce Department added that shipments of manufactured goods rose 0.1 percent in November, matching the increase that was seen in the previous month. At the same time, inventories edged up 0.2 percent in November after rising 0.3 percent in October. Subsequently, the inventories-to-shipments ratio edged up to 1.24 in November from 1.23 in October.

Business activity slowed in December.
Thursday morning, the Institute for Supply Management released its report on business activity in the services sector in the month of December. The report showed that the pace of growth in the sector slowed compared to the previous month. The Institute for Supply Management said its index of business activity in the sector fell to 57.1 in December from 58.9 in November, with a reading above 50 indicating growth in the sector. Economists had expected the index to fall to 57.0. The slowdown in the pace of expansion in the sector was partly due to slower new orders growth, with the new orders index falling to 54.4 in December from 57.1 in November. At the same time, the report showed an acceleration in the pace of employment growth, as the employment index rose to 53.3 in December from 51.6 in the previous month. Additionally, the report showed that the pace of price growth also accelerated during with month, with the prices index rising to 59.1 in December from 55.6 in November.


10:30AM NY – 9:00PM Mumbai - The Sensex in India declines on the weakness in large caps.
The Sensex on BSE closed 143.21 points, or 1.02%, lower at 13,871.71. The market-breadth was strong as mid-caps and small-caps were in focus. There were almost three advancers for every two decliners on BSE. For 1,525 shares that advanced, 1,085 declined on and 65 stocks remained unchanged. Of the 30 stocks in the Sensex, 24 declined, while the rest advanced. The turnover on BSE was Rs 4,508 crore higher than Rs 4,312 crore on Wednesday. The turnover on NSE was Rs 8,556.02 crore, compared to Rs 8,154.36 crore on Wednesday.

Economic news

The Hinduja group is likely to become the third bidder, alongside Reliance Communications Ltd. and Vodafone Group Plc for mobile phone operator Hutchison Essar Ltd. The price tag is rumored to be between $17billion and $20 billion. Hinduja official said that the Hinduja Group would like to buy at least 51% in the fourth-largest mobile phone operator in India.

Arcelor Mittal, the largest steel maker in the world, is to bid for a controlling stake in Indian iron ore exporter Sesa Goa Ltd. The company is valued at 80 billion rupees or $1.7 billion. Tata Steel, Sterlite and Jindal Steel & Power and Essar Steel are other companies reported to be seeking 51% stake in the company owned by Japanese conglomerate Mitsui Ltd. According to local newspapers Mitsui has appointed investment bankers to find a buyer for its stake.

The Indian cabinet approved on Thursday a levy exemption for ready-made garments in an effort to improve their competitiveness globally. The government has approved partial lifting of the ban on sugar exports as domestic prices fell and supply improved.

The Reserve Bank of India intends to allow financially strong cooperative banks in urban areas to open more branches and raise funds. The Reserve Bank will also encourage weaker banks to merge to help the consolidation process.

In trade today

Info Edge was the most-active stock with a turnover of Rs 120.60 crore followed by Unitech and Reliance Industries.

Advancers

Dr Reddy led the advancers, up 1.81% to Rs 823.15, on 2.89 lakh shares. L&T also gained 0.93% to Rs 1,490, for the second day in a row, following statement from the company on Wednesday that it had secured an overseas order worth over Rs 400 crore. Tata Motors added 0.90% to Rs 947.50, after the company ADR surged 6.1% on Wednesday to $21.69.