Asian-Pacific benchmarks closed the trading session with heavy gains on the back of oil prices which dropped below $64 a barrel as Hurricane Rita’s impact proved to be less than expected. Japan’s Nikkei climbed 1.8% on oil drop, strong U.S. dollar and positive data on domestic economy. South Korea’s Kospi surged 2.6%, boosted by easing oil and active local institutional buying. Hong Kong’s Hang Seng rose 0.9% on oil prices decline and property stocks.

European markets rallied to close the session with solid gains as oil prices declined after Hurricane Rita caused less damages than expected and automakers advanced as Porsche announced a decision to increase its stake in Volkswagen. The German DAX 30 soared 2.4%, the French CAC 40 climbed 2%, and London’s FTSE 100 rose 0.7%.

ENERGY, METALS, CURRENCIES

Oil prices hover over $64 a barrel after Rita’s strike which caused less damage than expected but still 4 million barrels per day of refining capacity are down. Light sweet crude November delivery traded as low as 70 cents before jumping $1.63 to $65.82 a barrel. Heating oil was up 10.6 cents to trade at $2.0888 a gallon, while gasoline jumped up 8.4 cents to $2.079. London Brent rose 18 cents to $62.62.

Gold advanced in European trading. In London the precious metal closed at $463.30 per troy ounce, up from $462.80. In Hong Kong gold lost $3.50 to close at $461.55. Silver closed at $7.27, up from $7.25.

The U.S. dollar advanced against the other major currencies. The euro was quoted at $1.2032, down from $1.2051. The dollar changed hands at 112.39 yen, up from 112.32. The British pound was trading at $1.7742, down from $1.7771.

EARNINGS NEWS

Nordic American Tanker Shipping Ltd. (NAT: chart) announced that based on current rates, it expects 3Q earnings within the range of 25 cents to 29 cents a share, missing the analyst estimate of 47 cents a share. Nordic also said it obtained a double-hulled suezmax vessel for use in the spot market.

Walgreen Co. (WAG: chart), drugstore operator, posted 4Q earnings of 32 cents a share, up slightly from a year-earlier profit of 32 cents a share, missing the analysts’ forecast of 37 cents per share. The latest results include a charge of $54.7 million, or 3 cents a share, following the impact of Hurricane Katrina. Excluding this item, the company reported a profit of 35 cents a share, in the same period. Sales rose 11.3% in the latest three months to $10.5 billion from $9.43 billion in the same period a year earlier. Same-store sales rose 7% in the quarter.

Analogic Corporation, (ALOG: chart) designer and manufacturer of high-precision health and security imaging equipment, reported 4Q net income of 31 cents a share, up from 29 cents per share in the prior year’s period despite a decline in revenue compared to the same period last year. 4Q security systems shipments rose substantially over the year-ago period, and also sales of medical Computed Tomography (CT) and clinical ultrasound systems. Continued growth in the sales of high-performance subsystems for CT and Magnetic Resonance Imaging (MRI) has been recorded. Sales of cardiac information management, Digital Radiography (DR), embedded multicomputing, and patient monitoring systems decreased vs. the same quarter last year.

CORPORATE NEWS

Boeing Co. reached a tentative agreement with its biggest labor union to terminate a month-long strike in its airplane factories, meeting most of the demands and breaking a deadlock.

Verizon Wireless and Alltel are expected to consider the acquisition of rural wireless company Midwest Wireless, the latest in a long line of small carriers in the U.S. to go on the auction block. The deal could fetch upwards of $1 billion.

Alpha Natural Resources (ANR: chart) has agreed to acquire coal reserves and operations affiliated with privately-held Nicewonder coal group in southern West Virginia and southwestern Virginia. The acquisition which has a total purchase price of $316.2 million is expected to add about 4.3 million tons to its coal output in 2006. The Appalachian coal producer warned that its third-quarter results will suffer the impact of a shortfall in metallurgical coal exports and lower-than-expected output from contractor-operated mines.