[R]4:00PM NY - 10:00PM Frankfurt – 2:30PM Mumbai[/R]

Yield on 10-year U.S. bond closed at 4.520% and the 30-year bond closed at 4.629%.

Gold increased $2.50 to close at $633.50 a troy ounce, silver advanced 6.5 cents to end at $13.96 a troy ounce and copper gained 2.65 cents to close at 313.85 cents per pound.

Oil lost 67 cents to close at $61.36 a barrel and heating oil declined 3.3 cents to finish at 172.43 cents a gallon. Gasoline was down 2.25 cents to end at 159.88 cents a gallon. Natural gas decreased 9.5 cents to close at $7.466 per mBtu.

Asian markets closed mostly higher led by Hong Kong with a gain of 0.99%, Singapore with an increase of 0.77% and Australia with an advance of 0.74%. The decliners were led by India with a loss of 2.90%, Indonesia with a decrease of 0.88% and Thailand with a decline of 0.62%. Japanese markets gained on a falling yen that gave a boost export oriented companies such as Toyota and Nissan.

European markets closed higher led by Spain with a gain of 0.94%, France with an increase of 0.81% and Germany with an advance of 0.65%. There were no decliners. European stocks recorded gains boosted by takeover bids for Corus Group and Egg, the Internet banking division of insurer Prudential.

Latin America markets closed higher led by Brazil with an increase of 0.74%, Mexico with a gain of 0.27% and Argentina with an advance of 0.16%. There were no decliners. Brazil gained as the market maintained an upbeat tone amid continued strong participation by foreign investors.

Peru and Venezuela are the two best performing stock markets for the year with gains of 103% and 84% respectively, followed by China, Indonesia, Russia and India. Saudi Arabia is the worst performing market in the world with a loss of 52% for the year. Of the 75 stock markets followed by 123jump.com, Saudi Arabia and Turkey are the only two markets down more than 10% year-to-date so far in 2006.

[R]1:00PM European markets finished higher, supported by takeover bids.[/R]
European stocks posted gains Monday, boosted by takeover bids for Corus Group and Egg, the Internet banking division of insurer Prudential. Corus shares climbed 5.5% in London after Brazil's CSN made a bid for Corus, valuing the company at 4.9 billion pounds, or 515 pence a share, a premium of 3% on Tata Group's second offer for the miner. The news lifted other steelmakers, with shares of Germany's ThyssenKrupp up 1.5% and Spain's Acerinox, up 2.5%. Automakers were also notable gainers as crude oil prices dropped below $62. BMW and Renault led advancers in Europe. The French CAC 40 climbed 0.8%, followed by the German DAX 30, up 0.78%, and London FTSE 100, up 0.1%.

Crude oil prices dropped below $62 a barrel. Crude oil January contract fell 45 cents to $61.58 a barrel. London Brent lost 13 cents to $62.07. The U.S. dollar was mixed against its major currency rivals. The euro was quoted at $1.3213, up from $1.3200. The dollar bought 117.05 yen, up from 116.47. The British pound was quoted at $1.9538, up from $1.9625. European gold prices declined. In London, gold traded at $629.30 per troy ounce, down from $636. In Zurich, the precious metal traded at $627.93 per ounce, down from $632.85. Silver closed at $13.79, down from $13.90.


[R]11:30AM Market averages turned higher, helped by deal news.[/R]
Stock markets were lackluster Monday, as several takeover deals generated positive mood, but cautiousness ahead of interest-rate decision Tuesday and weaker oil limited the gains. While the Fed is widely expected to leave rates unchanged, traders are worried what will be said in the accompanying statement.

Metals stocks advanced after hedge fund SAC Capital Advisors LLC bought a stake in mining company Phelps Dodge Corp. (PD: chart), and said it would oppose the company's planned takeover by Freeport-McMoRan Copper & Gold Inc. Among rising stocks, Biomet (BMET: chart) rose 4.1% on a report that Smith & Nephew might bid $11 billion to buy the medical device maker. Sabre (TSG: chart) jumped 7.7% on deal talk. Time Warner Inc. (TWX: chart) hit multiyear highs after it was upgraded by Prudential Securities, citing strong potential for improvement at the media conglomerate's cable division. Shares rose 1.3%. Harrah's Entertainment (HET: chart) advanced on several buyout offers. The casino operator received one from private equity firms Apollo Management and Texas Pacific Group, and Penn National Gaming Inc. and hedge fund D.E. Shaw are also said to be considering an offer.

The biggest drag on the Nasdaq was drugmaker Nuvelo (NUVO: chart) which tumbled nearly 82% after the company and German drugmaker Bayer said a Phase 3 clinical trial of a blood clot dissolver failed to meet its main goal. In late morning trading, the Dow Jones industrial average rose 26.19, or 0.21%, to 12,333.68. The S&P 500 index rose 3.58, or 0.25%, to 1,413.42, and the Nasdaq composite index was up 11.93, or 0.49%, at 2,449.29. Bonds rose, with the yield on the benchmark 10-year Treasury note falling to 4.52% from 4.55% late Friday.


[R]10:30AM The Sensex declines on RBI move to tighten monetary policy.[/R]
The Sensex on BSE lost 400.06 points, or 2.9%, to end at 13,399.43. The market-breadth was rather weak. As 1,974 shares declined, 589 advanced and 43 shares were unchanged. From the Sensex stocks, 25 stocks declined, the rest advanced. The turnover on BSE was Rs 4,830 crore, much higher than Rs 4,148 crore on Friday. On NSE, the turnover today was Rs 9,344.45 crore, higher than Rs 7,556.04 crore on Friday.

Economic news

On Friday, the RBI had raised the rates in cash reserve ratio, which is the amount of assets that all banks must deposit with the central bank, by 50 basis points to absorb Rs 13,500 crore from the system.

Finance Minister P Chidambaram expressed his confidence that bank stocks will adjust to new RBI guidelines and today’s market drop is not a long term concern.

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