U.S. market averages have recently weakened after a higher opening, boosted by strong earnings reports from Alcoa and Genentech, released at the beginning of the new earnings season. The news brought relief to the traders, who have been anxiously looking for signs that higher energy costs will depress corporate earnings. The Nasdaq is the biggest decliner of the averages and is moving to a new low for the day, giving up early gains on renewed advance of oil prices, which raise new inflation worries.

The Energy sector is a notable gainer, rising 1.5% on advance in oil prices, reversing some of the 9.5% losses from the previous six sessions.

The computer hardware space is posting modest gains with Apple up 2.7% ahead of its earnings release and the anticipated announcement of a new video iPod.

The Semiconductor sector is currently down by 1.2%, continuing its sharp decline from yesterday when stocks fell on Xilinx’s disappointing revenue outlook. The networking space is also weak, falling by about 1%.

Vical (VICL: chart) stands out among the gaining stocks with a 20% rally. The company announced that its HIV vaccine has moved into phase II development. Bally Total Fitness (BFT: chart), Mesa Air Group (MESA: chart) are ticking higher.

Three Dow components- SBC (SBC: chart), Verizon (VZ: chart) and JP Morgan (JPM: chart) - top the list of stocks that have set new 52-week lows during the morning. Ford (F: chart) is slightly lower. Helen Of Troy (HELE: chart) enjoys a new lower level on disappointing earnings and guidance released before the opening bell.

Gannett, media company, posted Q3 earnings decline of $1.13 a share vs. $1.16 a year ago, despite 4% revenue growth, but meeting analysts’ estimates.

Infosys Technologies, India’s second-biggest software exporter, reported Q3 36% profit increase to $137.7 million and raised its full-year earnings outlook.

Genentech Inc., the world's second-biggest biotechnology company announced Q3 56% profit rise on sales of its colon cancer drug Avastin and other products.

Dow component Alcoa Inc., the world's biggest aluminum producer, saw its shares rise 2% in after-hours trading on Monday after reporting slightly higher third-quarter net income.


MOVERS AND SHAKERS

The aluminum producer Alcoa (AA: chart) posted a third-quarter profit that was slightly higher than the reduced outlook it announced two weeks ago. Alcoa reported earnings of $289 million, or 33 cents a share, for the three months ended September 30, an increase from $283 million, or 32 cents, for the same period in 2004. Alcoa jumped 3.4%.

Genentech (DNA: chart) gained 5.7% after the company also reported higher-than-expected third-quarter net income. The company said net income increased 56% to $359.4 million, or 33 cents a share, in the quarter ended September, compared with $230.9 million or 21 cents a share for the same period in 2004.

Fast-food giant McDonald's (MCD: chart), a Dow component, added 2.5% after UBS lifted its price target for the stock by $6 to $43. The broker cited a spin-off of McDonald’s company-owned restaurants makes sense and would unlock shareholder value. The analysts are also optimistic on the company’s fundamental outlook heading into 2006.

Another Dow component, General Motors (GM: chart), climbed 1.2% after the company lost 10% of its value yesterday as a result of its former unit Delphi's bankruptcy filing.

Apple Computer (AAPL: chart) is going to report its earnings results after the close of trade. Analysts are expecting the company to post earnings of 37 cents a share for the quarter ended September on $3.73 billion in sales. Apple was up 1.3%.

INTERNATIONAL MARKET NEWS

Asian-Pacific benchmarks closed the trading session mostly higher. The Nikkei advanced 2.5% after the long weekend, rebounding from last-week sharp declines on the back of strong bank and machinery stocks. Across the region, South Korea’s Kospi gained 1.4% on sensitive to domestic consumption stocks. Hong Kong’s Hang Seng added 0.3%, while Australia’s All Ordinaries fell 0.8%.

European markets finished higher on signs of improving retail sector in the U.K. and strong earnings report from a Roche Holdings’ subsidiary Genentech. The German DAX 30 added 0.2%, the French CAC 40 rose 0.3%, and London’s FTSE 100 gained 0.1%. The euro fell 0.4% to $1.2004.