11:30AM U.S. stock averages traded down on rate worries and economic data.
U.S. stocks continued to post losses as investors turned to consolidation of recent gains, awaiting the Fed Reserve's decision on interest rates. Economic data released today added further pressure to stocks, as the Commerce Department said wholesalers' inventories grew at a slower rate in March, coming in below expectations.

Dow member Hewlett-Packard (HPQ: chart) bucked the downward trend. Company’s shares rose 2% after raising its Q2 financial outlook, citing strong operational results from its personal systems group and servers businesses. The Dow component said it now sees earnings of 64 to 65 cents a share on revenue of $25.5 billion to $25.55 billion. However, most of the blue-chip stocks declined. General Motors (GM: chart) fell 1.4%, Coca Cola (KO: chart) slipped 1.2%, and AT&T (T: chart) lost 1.2%.

Among the most notable gainers, Blue Nile (NILE: chart) surged 16% after the online jewelry retailer reported Q1 net earnings of 19 cents a share, up from 13 cents a share a year ago, helped by 34% revenue increase to $67.9 million. Quarterly results beat estimates of per-share profit of 15 cents on revenue of $61.7 million. In other earnings news, Revlon (REV: chart) rose 1.5% after it said its Q1 loss narrowed amid cost-cutting. The company reported a loss of $35.2 million, or 7 cents per share, compared to a loss of $58.2 million, or 15 cents last year.

Resource stocks showed significant weakness amid a decrease in commodities prices. Gold, oil service, and natural gas stocks posted notable losses, while computer hardware, computer technology and telecoms advanced. In late morning trading, the Dow Jones industrial average fell 57.94, or 0.44%, to 13,255.03. The Standard & Poor's 500 index was down 6.70, or 0.44%, at 1,502.78, and the Nasdaq composite index shed 11.28, or 0.44%, to 2,559.67.

Wholesale trade rose 1.8% in March.
Tuesday morning, the Department of Commerce released its report on wholesale trade in the month of March. While the report showed a notable increase in wholesale sales, wholesale inventories rose slightly less than expected. The report showed that wholesale sales rose 1.8 percent in March following a 1.0 percent increase in February. With the increase, wholesale sales rose at an annual rate of 8.4 percent. The sales growth was partly due to a rebound in wholesale sales of durable goods, which rose 2.1 percent in March after falling 0.8 percent in the previous month. Wholesale sales of non-durable goods rose 1.5 percent after rising 2.8 percent in February.

The Commerce Department also said that wholesale inventories rose 0.3 percent in March following a revised 0.4 percent increase in February. Economists had expected inventories to rise 0.4 percent compared to the 0.5 percent increase originally reported for the previous month. Subsequently, the inventories/sales ratio edged down to 1.14 in March from 1.15 in February, although the ratio was unchanged from March of 2006.


9:45AM U.S. markets opened lower amid profit-taking.
Wall Street opened in the negative on profit-taking ahead of the Fed Reserve''s meeting on interest rates. However, Dow member Hewlett-Packard (HPQ: chart) helped limit losses, rising 2% after the computer maker raised its Q2 earnings and revenue outlook. At the same time, telecom stocks were dragged to the downside by Motorola (MOT: chart) shares which fell 1.8% after the company said its shareholders didn''t elect billionaire shareholder Icahn to its board.

On the earnings news front, Warner Music Group Corp. (WMG: chart) posted a wider Q2 loss, hurt by restructuring costs and a decline in revenue. Warner Music lost $27 million, or 19 cents per share, compared with a loss of $7 million, or 5 cents per share a year ago, missing expectations of 9 cents loss. Duke Energy Corp. (DUK: chart) said its Q1 profit fell to 28 cents per share, down from 37 cents per share last year, coming short of estimates of 31 cents a share. The quarterly decline came after the power company spun off its natural gas business at the beginning of the year.

Pharmacy services provider CVS/Caremark Corp. (CVS: chart) announced Q1 earnings increase of 24% on strong revenue growth. Net income grew to 43 cents per share, from 39 cents per share a year ago, missing expectations of 45 cents a share. Industrial manufacturing conglomerate Tyco International (TYC: chart) posted Q2 earnings drop of 7% as higher costs offset revenue growth. Net income declined to 41 cents per share, from 43 cents per share a year ago, below analyst estimates of 47 cents a share.

In deal news, AK Steel (AKS: chart) climbed 15% amid reports that Arcelor Mittal is in talks to buy the U.S. steel producer in a $4.5 billion, or $40 a share, deal. In midmorning trading, the Dow Jones industrial average fell 71.03, or 0.53%, to 13,241.94. The Standard & Poor''s 500 index was down 8.01, or 0.53%, at 1,501.47, and the Nasdaq composite index shed 15.69, or 0.61%, to 2,555.26.


9:30AM London equities trade lower Tuesday on weak mining sector.

The U.K. market was lower in early deals on Tuesday. The FTSE 100 shed 36.3 points to 6,567.4 in late morning trade.

Advancers

Reuters gained as it outlined details of its merger with Canadian peer Thomson to create the biggest global news and financial information provider. The 8.8 billion cash-and-stock offer would value each Reuters share at 697 pence. Having jumped 25% on Friday, Reuters rose a further 4.3%.

The news boosted other publishers on expectations of further consolidation. Reed Elsevier rose 2.7% and Pearson gained 0.65. Music group EMI gained 3.9% on sustained hopes of a takeover after the company said on Friday it had receive a number of preliminary bid approaches.

Arken POP, part of Media Square, has secured a contract with CBS Outdoor to design and manufacture advertising display units for use across the London Underground network. The multi-million pound contract is the largest ever secured by Arken and lifted Media Square, up 8.9%.

Decliners

BHP Billiton, down 1.9%, Anglo American, off 1.6% and Xstrata, also 1.6% lower, headed south as metal prices sank from recent highs. Oil large-caps Royal Dutch Shell and BP also dipped 1.3% and 1.7%, respectively, as oil prices continued to trade below $62 a barrel ahead of US crude inventories report, released tomorrow.