U.S. MARKET AVERAGES

U.S. stocks advanced at opening of Wednesday session , supported by easing inflation worries and falling oil prices ahead of oil report, expected to show growing inventories. Recently stocks have fallen to the unchanged mark, failing to build greater upward momentum.

Wall Street was cheered by news of lower inflation rate due to oil prices decline.The Labor Department reported that consumer prices edged up just 0.2% in October, the best showing in four months. September consumer prices had soared by 1.2% on record energy prices. That inflation increase was the largest one-month jump in 25 years.

In the first hour of trading, the Dow Jones industrial average rose 20.25, or 0.19%.The Standard & Poor's 500 index rose 2.81, or 0.23% and the Nasdaq composite index rose 4.25, or 0.19%.

Bonds rose, with the yield on the 10-year Treasury note falling to 4.53% from 4.56% late Tuesday.

The gold sector is one of the most conspicuous movers to the upside, climbing by over 3%. The utility space is also strong, with the Dow Jones Utilities Index higher by about 1%. Energy stocks are posting gains, including a 1% rise in the oil service sector.

There are few notable decliners. The retail sector is edging lower, continuing its Tuesday's slide. The drug and software sectors are also weak. There is some weakness in disk drive and networking stocks. Housing stocks are also showing a modest retreat, with DR Horton (DHI: chart) edging slightly lower on cautious guidance for the next fiscal period.

IntercontinentalExchange (ICE: chart) is a significant gainer in its debut on the NYSE. Following an IPO of 16 million shares at $26 per share, shares of the energy futures exchange are about $14.75, or 57%, higher than the offering price.

Blue Coat Systems (BCSI: chart) is a notable decliner on earnings and outlook. The stock is currently down by 13%.

ECONOMIC NEWS

The Department of Labor released its closely watched report on consumer prices in the month of October on Wednesday, showing that prices rose modestly after surging higher in the previous month.

The report showed that consumer prices rose by 0.2 percent in October following a 1.2 percent increase in September. Economists had been expecting a slightly more modest increase of about 0.1 percent.

The significant slowdown in the pace of price growth compared to September came as energy prices fell 0.2 percent in October after surging up a record 12 percent in the previous month. Transportation prices also showed a notable decrease.

The report also showed that core consumer prices, which exclude food and energy prices, rose 0.2 percent in October after rising 0.1 percent in each of the five previous months. The increase in core prices came in line with economist estimates.

The modest increase in core prices suggests that the increase in energy prices is not being passed on in the prices of other products. Subsequently, core inflation has remained relatively subdued, rising at an annual rate of 2.1 percent.

MOVERS AND SHAKERS

The homebuilder D.R. Horton (DRI: chart) raised its 2006 profit outlook after posting fourth-quarter results that beat expectations. The company's strong performance could help relieve the worries that the sector is suffering a downturn caused by a profit warning from Toll Bros (TOL: chart) last week. D.R. Horton’s stock closed 0.3% down on Tuesday, but is expected to gain today.

The fashion retailer Abercrombie & Fitch (ANF: chart) boosted its full-year profit outlook after third-quarter results increased 79% to $71.6 million as compared to a year ago values. Sales during the quarter rose 35% to $704.9 million. The company’s shares added 4.3%.

The specialty apparel retailer The Talbots Inc. (TLB: chart) reported forecast-beating third-quarter profit and said its store traffic and sales performance made a significant progress in the second half of October. The stock fell 4.3% on Tuesday, but is likely to increase slightly today.

INTERNATIONAL MARKET NEWS