U.S. MARKET AVERAGES

After four hours of trading the U.S. stock futures are in the positive territory, up 0.5%. The market opened lower as the wholesale price index reported largest increase in nine months of 1% during July, but later investors picked up a little momentum and direction changed into positive. The major averages keep high levels of trading with the Nasdaq in the lead, rising 0.3%

The computer hardware sector rebounded after declining more than 3% Tuesday on Gateway earnings report.

Gold sector lost ground on strengthening dollar, falling 1.5%.
Housing stocks also have a weak trading session, going down almost 1%.

Utilities went lower as higher interest rates have diminished the appeal of dividend-paying stock.

In the stock market

The tech sector rose as Hewlett-Packard reported 3Q earnings of 36 cents a share excluding special items and exceeded expectations of 31 cents a share. Quarterly sales rose 10% to $20.8 billion. The company projected 4Q revenue of $22.4 to $22.8 billion with earnings between 44 and 47 cents a share. Company’s shares rose 10%.

Applied Materials rose 5.9% after announcing a likely rise in orders. The chip maker posted 3Q 27% sales and 16% earnings decline on industry slowdown. The company earned $369.6 million, or 23 cents a share, down from $440.6 million, or 26 cents a share, beating estimates by a penny, but missing revenue forecasts of $1.65 billion.

The good news from Hewlett-Packard and Applied Materials spilled over to help other tech shares, with Intel up 7 cents to $26.

In the retail stock market Nordstrom rose 8% as the luxury retailer reported 2Q 39% profit rise of $148.9 million, or 53 cents a share vs. 37 cents a year ago on 7.8% revenue growth to 2.1$ billion with same-store sales increase of 6.2%.


The oil markets gyrated immediately upon release of the weekly petroleum report this morning at 10:30 AM.

In a tight supply and demand situation market is paying a close attention to the inventories situation. Over the last week, crude inventories increased by 0.3 million barrels and gasoline inventories declined by 5 million barrels. The crude inventory build up was expected to be $1.25 million barrels and gasoline inventory drawdown was expected to be less than 1.5 million.


ECONOMIC NEWS

The wholesale price index reported largest increase in nine months of 1% during July. Many of the factors driving the wholesale inflation are the same that are driving the consumer price inflation.

The wholesale index measures the rate of inflation before it reaches at the consumer level.

The only difference between the two reports was that the automobile prices declined in the consumer price inflation by 1% whereas at the wholesale level measurement they increased by 1%.

The PPI data showed that the prices rose for energy by 4.4%, electricity by 0.7%, gasoline by 10.9%, natural gas by 3.7% but for food dropped by 0.3%. The prices for pharmaceuticals rose by 1.3%.

INTERNATIONAL MARKET NEWS