1:00PM NY, 5:00 PM Frankfurt European markets ended lower for a fifth straight session, dragged down by rate worries.

European stock markets closed lower Friday for a fifth consecutive session, pressured by continuous worries about the impact of higher interest rates. The downward trend was bucked by gains in the shares of BNP Paribas which rose amid takeover speculations. Shares of the French bank gained 1.5%.

Strength among chip makers, led by Infineon Technologies and STMicroelectronics failed to lift sentiment. The chip makers rose more than 1.1%. Vodafone was among advancers for a second day in a row, moving up 1% as investors continued to assess restructuring prospects for the company.

Mining companies stood out among losers, with Vedanta Resources losing 2.5%, Kazakhmys falling 1.4%, and BHP Billiton losing 1.4%. Shares in oil giant Royal Dutch Shell added 0.8% after it was upgraded to buy from neutral at Merrill Lynch with the broker lifting its price target to 2,150 pence. The U.K. FTSE 100 finished unchanged at 6,505.10, the German DAX Xetra 30 fell 0.4% at 7,590.50 and the French CAC-40 slipped 0.1% at 5,883.29.


11:30AM U.S. market averages traded slightly higher. Lower trade deficit boosted the dollar and bonds.

U.S. stock market averages moved modestly higher, as investors turned to bargain hunting after recent weakness, with concerns about the outlook for interest rates still weighing. News that the U.S. trade deficit narrowed by 6.2% in April helped boost the dollar and the bonds. In recent action, the benchmark 10-year Treasury bond was up 5.124%.

Some positive sentiment was generated by a notable decline by the price of oil. Shares of Royal Dutch Shell (RDSA: chart) traded in the U.S. were among the leading gainers in the oil group, rising 1%. At the same time, gold stocks posted weakness amid a continuous drop by the price of gold. Gold futures tumbled nearly 2%, extending their four-session losing streak, as the dollar rallied against other major currencies.

Significant strength was visible in the semiconductor, airline, and brokerage sectors. The semiconductor sector was boosted by National Semiconductor (NSM: chart) which surged 14% after delivering stronger-than-expected Q4 earnings.

In late morning trading, the Dow Jones industrial average rose 16.34, or 0.12%, to 13,283.07. The blue-chip average was led higher by General Motors (GM: chart), up 2.1% and Alcoa (AA: chart) shares, rising 1.1%. The Standard & Poor''s 500 index rose 2.30, or 0.15%, to 1,493.02, and the Nasdaq composite index rose 10.24, or 0.40%, to 2,551.62.


9:45AM U.S. stocks opened higher on bargain hunting.

U.S. stock markets posted modest gains at opening on Friday on bargain hunting after three days of heavy losses. However, concerns about rising bond yields continued to take their toll. Following an improvement in the April trade deficit, the yield of the benchmark 10-year Treasury bond retreated from an overnight high of 5.25%. Utility stocks recovered slightly as the yield on the 10-year Treasury retreated to 5.1%. Constellation Energy Group (CEG: chart) fell 1.3%, while Entergy Corp. (ETR: chart) rose 2.3%.

The Dow was led higher by McDonald''s (MCD: chart) which rose 2.35% after saying global same-restaurant sales rose 8.7% in May. Tech stocks were sent higher by strength in the chip sector. National Semiconductor (NSM: chart) surged 10% after posting better-than-expected drop in profit. The company also said it was buying back $2 billion worth of shares. Further boost to the Nasdaq was given by chip maker Texas Instruments (TXN: chart) which added 2.2% and analog chip maker Maxim Integrated Products (MXIM: chart) which advanced 1.4%.

Crude oil futures declined, sending oil shares down. Exxon Mobil Corp. (XOM: chart) lost 0.8% and Chevron Corp. (CVX: chart) stock lost 1.2%. In early trading, the Dow Jones industrial average rose 1.38, or 0.01%, to 13,268.11. The Standard & Poor''s 500 index fell 3.22, or 0.22%, to 1,487.50, and the Nasdaq composite index fell 6.41, or 0.25%, to 2,534.97


9:15AM U.S. stock futures traded in a lackluster fashion.

U.S. stock futures turned in a lackluster fashion on Friday, slightly recovering from steep losses recently. Rising bond yields and positive results from National Semiconductor were the pre-market highlights. The dollar rose sharply against the euro and the yen. Crude oil and gold futures declined.

Shares of National Semiconductor (NSM: chart) climbed 9% in electronic trading after reporting a smaller-than-forecast 24% profit drop. The company also said it was buying back $2 billion worth of shares. UBS upgraded the stock to buy from neutral. Rival companies Texas Instruments (TXN: chart) advanced 1.8% and chipmaker Maxim Integrated Products (MXIM: chart) rose 2.7%.

Again in the sector, Qualcomm (QCOM: chart) appealed a regulatory ruling that is preventing the import of mobile devices containing chips made by the company. In other corporate news, McDonald''s Corp. (MCD: chart) rose 0.8% in pre-open trade, following news that its global same-restaurant sales surged 8.7% in May.

On the economic news front, the Commerce Department said that U.S. trade deficit narrowed by 6.2% in April to $58.5 billion, coming in below the consensus forecast of $63.5 billion. S&P 500 futures eased 0.5 of a point at 1,503.20 and Nasdaq 100 futures rose 2.75 points at 1,910.00. Dow industrial futures rose 10 points.