[R]10:00PM Frankfurt, 4:00PM New York, 8:00AM Sydney – European banks closed lower on a large asset write-off at a German state controlled bank.[/R]

Global Markets Update

European banks after rallying for three days fell on a sharply higher loan loss at BayernLB. The news and downgrade of banks from several analysts took BNP Parisbas, Societe Generale, UBS, Deutsche Bank and Lloyds TSB lower.

BayernLB, the largest German state controlled bank reported a sharp decline in profit to 175 million euros in 2007 from 989 million euros a year ago on larger than expected write-down in risky loans linked to the U.S. residential market. The bank wrote-off 4.3 billion euros in loans and said it still has 11% of its asset backed securities portfolio of 33 billion in sub-prime loans. The bank is likely to separate at least 20 billion euros in a special unit with a guarantee of 6 billion euros from the bank.

Europe’s largest refiner forecasted average crude oil price of $60 a barrel by the end of 2010 and plans to invest 1 billion euros a year for the next five years. However, the refiner also suggested that margins in the first quarter of this year have been lower than in 2007 on higher crude oil prices.

Air Liquid plans to invest $1 billion in the Middle East countries in the next five years according to its chief executive Benoit Potier and reported on Bloomberg Web site.

Alitalia, the sick Italian airline, may have to seek bankruptcy protection if unions, Italian government and AirFrance KLM do not return to negotiations soon. The recent talks were called off after the union balked at the demands to eliminate half the staff. Alitalia stocks and bonds were suspended from trading in Milan.

For months, U.S. economists and Fed regulators have denied that the U.S. economy is in recession, but evidence is mounting that weakness in housing market and in financial services is spreading into the broader economy. Jobless claims at the end of the last week rose by 38,000 and now nearly 3 million people are receiving weekly unemployment benefits according to the Labor Department. Separately ABA quarterly report showed more consumers are falling behind on their loans.

Research in Motion, maker of popular wireless communication device maker, surged after reporting sharply higher sales and earnings. The revenue rose 102% to $1.88 billion and net income increased 120% to $412 million. RiM shipped 4 million devices in the fourth quarter and 14 million in the fiscal year. Wine distributor reported a decline in sales and a loss after paying preferred dividend but forecasted higher than estimated profit for the current year.

UK lenders of home and corporate loans are likely to curtail their lending activities in the near future as credit markets remain tight, according to a report published on the Bank of England Web site. The interbank lending in UK and in the European region still remains tight. International Power led advancers in the FTSE 100 index shares with a rise of 3.73% followed by increases in BG Group Plc of 3.47%, in Severn Trent of 2.76%, in Anglo American Plc of 2.29%, and Lonmin Plc of 2.13%.

Stocks in Japan gained on a rally in commodities and trading companies. Financial and property stocks gained for the second day in a row. Nikkei 225 rose 1.52% or 200.54 to 13,389.90, while the broader Topix Index increased 1.4% or 17.57 at 1,299.64. Nippon Suisan led gainers in the Nikkei 225 index with a rise of 8.8% followed by rises in Sojitz Corp. of 7.40%, in Mitsui Sumitomo Insurance Group Holdings of 7%, in Obayashi Corp. of 6.8%, and T&D Holdings Inc of 6.6%.

In Hong Kong, rising commodities prices in the region and a second-day rally in financial stocks lifted Hang Seng index 1.6% to 24,264. Stocks in Shanghai rose 3%. ADB, Asian Development Bank estimated Hong Kong growth of 4.5% and inflation of 3.4% in 2008. Apartment sales in shanghai were healthy in March and are expected to remain strong in the first half of the year.

IT stocks in India lifted Sensex in the session. Infosys, Wipro, Satyam and Tata Consultancy gained between 3% and 5%. Bharat Heavy fell after it reported net income for the year rose 17% to 2,815 crore rupees. Indian Oil is expected to issue bonds of 31 billion rupees backed by Indian government to fund the losses generated from selling oil below market price. Separately, Reliance Industries plans to close 1,600 petrol stations.

European Markets indexes

In London FTSE 100 Index closed lower 24.60 or 0.42% to 5,891.30, in Paris CAC 40 Index decreased 24.10 or 0.49% to close at 4,887.87 and in Frankfurt DAX index lower 35.72 or 0.53% to close at 6,741.72. In Zurich trading SMI decreased 80.42 or 1.06% to close at 7,516.23.

North American Markets indexes

Dow Jones Industrial Average increased 20.20 or 0.16% to a close of 12,626.03, S&P 500 closed up 1.78 or 0.13% to 1,369.18, and Nasdaq Composite Index increased 1.90 or 0.08% to a close at 2,363.30. In Toronto TSX Composite closed up 37.15 or 0.27% to 13,551.29.

Of the 30 stocks in Dow Jones Industrial Average, 17 closed higher, 13 closed lower, and none were unchanged.

Alcoa led the gainers in the Dow Jones Index with a rise of 5.8% followed by increases in Merck of 3.4%, in General Motors of 2.96%, and in Citigroup of 1.4%. Caterpillar led decliners in the index with a fall of 1.8% followed by losses in Boeing and 3M of 0.9%, and in Pfizer of 0.8%.

Of the stocks in S&P 500 index, 248 stocks increased, 246 declined, and 6 were unchanged. Of the stocks in the index, 1 stock fell more than 3% and 308 gained more than 3%.