[R]4:15PM Natural gas lost 11% dragging with it energy stocks during a day when trading in general market was lackluster.[/R]

-Yield on 10-year bond closed at 4.78% and 30-year bond closed to 4.91%.

-Crude oil dropped 75 cents to $63.22 per barrel and natural gas fell 55 cents or 11% to close at $4.89, two year low on inventory report.

-Gold lost $10.30 to close at $586, silver lost 25 cents to close at $10.95 and copper edged 1 cents lower to $3.3745.

-Except Hong Kong and Taiwan, Asian markets rallied led by a rise of 1.9% in Korea, 1.2% in Japan and Philippines, 1.01% in Australia, 0.7% in India and Indonesia and 0.5% in Thailand. Hong Kong lost 0.15% and Taiwan dropped 1%.

-European Markets closed nearly unchanged with Switzerland declining 0.4%, UK and France losing 0.25% but Spain, Germany and Netherlands up a fraction .

-Latin Markets were nearly unchanged with Brazil and Argentina down 1.05% and 0.21%. Mexico failed to hold on to its earlier gains and closed 0.06% up but Chile managed to close up 0.4%. Canada lost 1.05% at close.

[R]3:00PM Oil and gas stocks are trading at their worst level for the year after a sharp decline in the last thirty days.[/R]
Market averages are still in the negative zone but have recouped most of the loss of day on falling oil price. Oil declined 1.3% or 80 cents to $63.15 per barrel. Natural gas for the current month delivery was down 9% on the government report that the inventories are at fifteen year high. Natural gas traded 50 cents lower to $4.91 per mBTU.

Energy stocks declined on lower energy prices. Explorers, refiners and equipment makers stocks have been under pressure in last one month of trading and have lost between 15% and 30% in value. Refiners, Valero (VLO: chart) has lost 22% from its peak at $64 a month ago and Tesoro Petroleum (TSO: chart) has declined 24% from a peak of $72 in the same period. Integrated oil companies Exxon Mobil (XOM: chart) has lost 7% from its peak of $71, Conoco Phillips (COP: chart) has declined 15.4%, Chevron (CVX: chart) has edged 10.2% lower but Marathon Oil (MAR: chart) has jumped 7% in the last one month.

[R]12:30PM European markets closed in the red.[/R]
European markets finished in the red Thursday affected by losses on Wall Street due to a combination of economic data and downgrades of major blue-chip stocks. Positive earnings from retailers along with gains in the mining sector failed to improve market sentiment. Swiss luxury-goods group Richemont gained 2.1% after it said total sales for the five months ended in August rose 16%. Hermes International rose 3.3% on 7.8% profit growth. Home-improvement chain Kingfisher gained 2.3% after it said first-half total retail sales climbed 6.6% to 4.35 billion pounds. Higher metals prices helped resource stocks like Rio Tinto and BHP Billiton move higher. The German DAX 30 ended flat at 5,907, the French CAC 40 lost 0.3%, and London FTSE 100 declined 0.3% as well.

Oil prices declined along with natural gas prices which hit a two-year low after the Energy Department data showed U.S. inventories of natural gas rose more than expected. Light crude October delivery fell 43 cents to $63.54 a barrel. Natural gas futures slipped 40 cents to $5.04 per 1,000 cubic feet. The U.S. dollar was weak versus major currencies. The euro traded at $1.2727, up from $1.2692. The dollar bought 117.49 yen, down from 117.56. The British pound stood at $1.8892, up from $1.8763. European gold rebounded from recent weakness. In London the precious metal traded at $587.60, up from $587 per ounce. In Zurich gold traded at $590.35, up from $586.05. Silver closed unchanged at $11.09.

[R]11:30AM Stocks traded lower on inflation worries.[/R]
Market averages kept trading in the negative mood, hurt by price data which revived fear that the U.S. rate-tightening cycle is not over. While retail and housing stocks saw some early weakness, gains by utility stocks helped to limit the downside. The computer hardware and airline sectors also showed some strength. At the same time oil and gas stocks reversed from earlier gains as crude prices failed to hold their ground and U.S. reported that natural gas supplies fell to a two-year low. Crude oil futures for October delivery dropped 10 cents at $63.90 a barrel. October natural gas futures fell 22.9 cents, or 4.2%, to $5.22 per 1,000 cubic feet. Among the biggest movers in the oil group, Marathon Oil Corp. (MRO: chart) was leading the decliners, down 1.8% to $74.22 a share, while ConocoPhillips (COP: chart) was leading the few gainers in the oil group, up 0.2%.

After upbeat reports from Goldman Sachs (GS: chart) and Lehman Bros (LEH: chart) and a strong rally in the brokerage sector earlier in the week, Bear Stearns (BSC: chart) reported better-than-expected fiscal Q3 earnings and revenue, and continued the pattern of investment bank results exceeding forecasts. Bear Stearns was down 57 cents at $135.65. In late morning trading, the Dow Jones industrial average fell 19.69, or 0.17%. The Standard & Poor''s 500 index fell 2.34, or 0.18% and the Nasdaq composite index slipped 0.74, or 0.03%. Bonds fell, with the yield on the benchmark 10-year Treasury note flat at 4.76% from late Wednesday.

[R]10:30AM The Sensex closes higher as large-caps in banking and IT stocks rally.[/R]
The Sensex on BSE finished 79.23 points, or 0.67% higher, at 11,973.02. The market-breadth, positive in the first half of the trading session, turned negative as selling pressure intensified in small-caps and mid-caps. For 1,116 shares that advanced, 1,380 declined and 72 shares were unchanged. From the Sensex stocks 18 advanced while 12 declined. The turnover on BSE was Rs 3,365 crore, much lower than Wednesday Rs 3,999 crore. The turnover on NSE was Rs 8,424.29 crore.

Market resurged and returned to near 12,000 level, after five months of trading.

Private sector banking large-cap, ICICI Bank soared 3.04% to Rs 650 on 4.97 lakh shares. Grasim advanced 2.83% to Rs 2,393, and Gujarat Ambuja Cements jumped 1.90% to Rs 115.20 were the other top advancers. Dr Reddy’s Labs gained 1.20% to Rs 746.15 on 4.24 lakh shares. The company is reportedly on the look-out for acquisition in Italy and Spain, and plans to expand into Europe.

The IT sector was in strong demand. Satyam Computers advanced 0.82% to Rs 808.80 on 7.22 lakh shares and Infosys Technologies Ltd gained 1.25 to Rs 1,831.85 after the domestic bank in Croatia, Hrvatska Postanska, selected company’s banking solution to drive its technology-led transformation initiative.

Index heavy Reliance Industries surged to a high of Rs 1,136.05, but retreated at close. It finished 0.7% higher, to Rs 1,124.15, on a volume of 12.62 lakh shares. Reliance Industries was the most-active stock on BSE with a turnover of Rs 142.45 crore, followed by Reliance Capital with Rs 137.14 crore.

Cement shares were in focus following reports that prices could go up between Rs 5 and Rs 10 per 50 kg bag, as demand soars after monsoon. Prism Cement gained 5% to Rs 39.90, ACC advanced 1.47% to Rs 945, Madras Cement rose 3.70% to Rs 3134.50, Birla Corporation moved up 11.35% to Rs 332.70, Mangalam Cement surged 5.92% to Rs 199.40, India Cements advanced 2.64% to Rs 208, JK Lakshmi Cement spurted 7.30% to Rs 15 and UltraTech Cement jumped 4.65% to Rs 821.

The banking sector led the advancers today. State-run banks surged. Corporation Bank jumped 5.27% to Rs 353.55, Bank of Baroda edged up 1.35% to Rs 266, Allahabad Bank rose 3.95% to Rs 79, Oriental Bank of Commerce gained 1.52% to Rs 223.20 and Indian Overseas Bank advanced 4.78% to Rs 103. Private sector banks also surged. Karur Vysya was up 6.31% to Rs 294, UTI Bank moved ahead 3.42%, to Rs 351, and Federal Bank advanced 5.58%, to Rs 211.75.

Decliners included Hero Honda which fell 1.755 to Rs 765.05, Bharti Airtel sank 1.145 to Rs 438, HDFC Bank was off 1.12% to Rs 864, Reliance Energy fell 1.06% to Rs 465.50 and Maruti shed 0.74% to Rs 948.90.